Irish investment bank International Securities Trading Corporation (ISTC) said today it had postponed its results and suspended grey market trading of its shares as it assesses the impact of the credit crisis.
The Dublin-based ISTC, which also cancelled a convertible bond issue, today said it expected to take a one-off charge of at least €70 million as it revalues around €200 million worth of SIV capital notes it holds.
ISTC said all its structured investment vehicle (SIV) notes, which make up seven per cent of its portfolio, had been either downgraded or put on review for downgrade by Moody's Investors Service last week.
As a result, "ISTC believes that it will now have difficulty in retaining the existing financing or alternatively obtaining new financing for the SIV capital note portfolio," the company said in a statement.
Paul Somers, an executive director at ISTC, said the company only owned notes issued by bank-sponsored SIVs. The bulk of ISTC's portfolio is in Tier 1 and Upper Tier 2 bank debt issued by banks across Europe, he said.
"What it means for us really is that we are talking to all our banks," he said. "We'll probably meet them over the next few days and will be explaining to them our overall position with clear reference to the SIV capital notes and the impact they've had on us."
"We've just decided to take a more prudent view on this than most people because they (the notes) may or may not be downgraded ... It's incumbent on us to take action right now."
ISTC, which specialises in bank capital lending, was founded in 2005 by Managing Director Tiarnan O'Mahoney, a former chief operating officer at Anglo Irish Bank.