RATINGS AGENCY Standard & Poor’s (SP) has revised its outlook on AIB’s UK business from “developing” to “negative” as a result of the bank’s confirmation on Monday that the sale of the UK entity is on hold.
The ratings agency said that it believed the likelihood that AIB UK may be acquired by a higher-rated parent in the next six months has “substantially diminished”.
“The negative outlook on AIB UK is consistent with our view on AIB,” SP said. “We consider that AIB UK remains ‘strategically important’ to AIB, in accordance with our group-rating methodology.”
The agency also said that it “seems probable” that the bank will become majority-owned by the Irish state.
The ratings agency affirmed the BBB/A-2 long- and short-term counterparty credit ratings on the bank’s UK business. It said the negative outlook is consistent with the agency’s view on the operation and can be expected to move in line with any rating action on the parent.
Meanwhile, AIB announced yesterday that the sale of its 22 per cent stake in MT has been completed. Shareholders approved the sale at an egm on Monday. The transaction, underwritten by Morgan Stanley and Citigroup, will yield a gain of €900 million, according to analyst estimates.
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