Uncertainty in financial area may last weeks despite merger courtships
The long-running feeling is that the Government may pressurise a merger between AIB and the Irish Nationwide Building Society, although it would seem the other mooted possibility — a three-way tie-up of Bank of Ireland, Anglo Irish Bank and Irish Life & Permanent (IL&P) — is now less likely.
AIB yesterday said that any statement regarding its current stance was unlikely this week. Bank of Ireland, meanwhile, reiterated its stance that it had made no decision over unsolicited approaches made to it last week.
Speculation about private equity investment — by US investors JC Flowers, Cardinal Asset Management and the Carlyle Group — in the likes of Bank of Ireland, IL&P and Anglo Irish Bank gave the ISEQ a much needed boost yesterday.
The Irish Examiner reported on Saturday that Bank of Ireland was, however, talking with New York-based investment bank Sandler O’Neill over the possibility of it taking an equity stake in Ireland’s second largest bank.
No new information was forthcoming from IL&P yesterday, after it said on Friday that it was beginning what might lead to takeover talks with the EBS Building Society.
It is understood that IL&P is strongly opposed to being forced into any merger with Bank of Ireland, which would likely put nearly 4,000 jobs at risk.
Chairmen and chief executives of the six big Irish banks are set to meet with Finance Minister Brian Lenihan towards the end of this week to put their cases against re-capitalisation to the Government.
One new development yesterday, however, saw the US investment company, Harris Associates up its stake in Bank of Ireland to 6.05% after snapping up just under one million shares and taking the number of shares it owns to just over 60.7 million.
Additionally, Anglo said that it was looking to raise €1 billion in cash through a bond issue.
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