No immediate plans to sell bank shares - Paschal Donohoe

Minister for Finance Paschal Donohoe has said that while his department continues to monitor the performance of both Permanent TSB and Bank of Ireland, it has no immediate plans to sell any of the state's shares in the banks.

In a response to a parliamentary question seen by Bloomberg, the Minister made clear that the department is planning for exit opportunities, but that those opportunities haven't been presented thus far.

In relation to AIB, the Finance Minister said he expects no further sale of the bank's shares in 2017 and that any future sale before the end of 2018 would need to be approved by the government.

The government recently off-loaded 25 per cent of its ownership in AIB while continuing to hold some 71 per cent of the bank through the Ireland Strategic Investment Fund.

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Meanwhile, Fine Gael MEP Brian Hayes called for the government's 14 per cent stake in Bank of Ireland to be sold before the end of this year, saying "this would be the perfect source of income to kick-start our rainy day fund which is expected to be set up in 2019."

According to Mr Hayes, the government’s stake in the bank is worth over €1 billion based on the current share price. “Given that we expect to put €1 billion into our rainy day fund every year this is the ideal way to start the process and build up our savings to protect against the risks of Brexit and other potential economic shocks”, he said.

Mr Hayes's rationale for selling now lies in the uncertainty surrounding the UK's decision to exit the European Union. "Given that bank of Ireland is the most exposed bank to the UK market it may be prudent to offload the stock before the oncoming uncertainty of Brexit.

“It would be a positive message for the government and for the Irish economy if we can soon state that one of our pillar banks has been fully returned to the private sector and is free of government influence”, he added.