AIB Project Redwood loans draw interest from Goldman Sachs

Portfolio of loans was once valued ta €3.75 billion

Photograph: iStock

Photograph: iStock

 

AIB’s sale of loans once valued at about €3.75 billion is drawing interest from potential bidders including Goldman Sachs, according to a person familiar with the matter.

Goldman is carrying out due diligence on the portfolio known as Project Redwood as part of a potential joint bid, said the person, who asked not to be named as the information is private. A Goldman spokesman declined to comment.

Oaktree Capital Group, Apollo Global Management and Deutsche Bank AG are among other firms assessing the portfolio.

First round bids are due by the end of January, said the person, with the sale set to close before the end of June. The mix of commercial real estate loans and residential rental mortgages will likely sell for less than par value, as at least some are in arrears.

The sale comes as AIB looks to slash its level of non- performing loans, which is one of the highest among euro-area banks. AIB classed loans worth about €12 billion as non- performing at the end of June, which amounts to about 19 per cent of its total gross loans. The EU average is just under 5.5 per cent, according to the European Central Bank.

AIB is focused on reducing impaired loans to closer normalised European peer levels, it said in an email response to a request for comment. It’s reviewing all options in relation to reducing impaired loans including further sales, the Dublin- based lender said.

Deutsche Bank, Apollo, and Oaktree declined to comment. - Bloomberg