AIB to sell credit bank stake to rival for undisclosed sum

AIB HAS agreed to sell its 49.99 per cent stake in Bulgaria-American Credit Bank (BACB) to a local rival CSIF AD for an undisclosed amount.

The bank has also received fresh bids for AIB Investment Management, following Irish Life’s decision last month to pull out of buying the business having been chosen as the preferred bidder in February.

Irish Life was expected to pay €15 million to €20 million for AIBIM. It is understood three or four new bids were submitted last week for AIBIM. This included a joint offer from Bloxham Stockbrokers and Swiss asset manager Bellevue Group, which bid last time around.

Informed sources said two UK institutions, possibly private equity groups, also submitted offers. Some sources suggested that IIU, an IFSC-based investment vehicle controlled by Dermot Desmond, had also lodged an offer but this could not be confirmed.

Bidders were asked to submit offers on the assumption that AIB’s own pension business would not travel across.

AIBIM has assets under management of €9.4 billion and has offices in Dublin and New York.

The Irish Times has also learned the Ballsbridge-based bank is seeking to offload AIB Financial Services, a unit of its capital markets division that specialises in structured finance. It is understood IIU has expressed an interest in acquiring this business.

The sale process is being run by Goodbody Stockbrokers, which itself was sold by AIB last year to Kerry-based financial services group Fexco. Goodbody is also handling the sale of AIBIM.

These disposals are part of AIB’s moves to offload non-core assets as part of a wider restructuring and recapitalisation agreed with the State and the EU.

The bank said the disposal in Bulgaria would have “no material impact” on its capital position.

AIB paid €216 million in cash in 2008 to acquire its stake in the bank, which is listed on the Bulgarian Stock Exchange. The deal is subject to local regulatory approvals.

The Government has injected €7.2 billion into AIB, taking a 93 per cent stake. The Central Bank ordered AIB to raise a further €13.3 billion after stress tests in March.

A merged AIB and EBS Building Society will form the “second pillar” in a restructured banking system under the Government’s plans.