US ‘activist fund’ increases its stake in Bank of Ireland

US FUND manager Harris Associates has increased its stake in Bank of Ireland to just over 7%.

Harris — which is based in Chicago and is recognised as being one of the leading so-called “activist funds”, which generally like to buy up enough stake holding in companies in order to get a say in the running of the firm — has been investing in Bank of Ireland for a little more than a year.

The company built up a 3% stake in October 2007 before increasing that stake to 5% in July of last year. Last November, Harris announced that it had upped its stake in the bank to more than 6%, adding that it was “a long-term value investor” in the bank.

Yesterday, the US fund informed the bank via a stock exchange statement, that it had acquired a further eight million shares, bringing its overall shareholding in Bank of Ireland to 7.73% and the number of shares it owns in the company to just over 77.6 million. To date, Harris Associates is best known, on this side of the Atlantic at least, for investing in British advertising giant, Saatchi & Saatchi and leading an investor revolt in the mid 1990s that ultimately led to the removal of founding members, the Saatchi brothers, Charles and Maurice.

Bank of Ireland, which said it does not comment on investor movement in its shares, was the only one of the Irish banking stocks to show a decline in share price yesterday. The bank fell by 1.16% — or 1c — to close at 94c. This was mainly on the back of speculation — and the lack of any official response — that it was negotiating a retirement plan for chief executive Brian Goggin.

Elsewhere, Anglo Irish Bank, which is expected to name a successor to departed chief executive, David Drumm later this week, rose by nearly 13% — or 4c — to 32c; while Irish Life & Permanent was up by 8.5% at €2.68 and AIB, on the back of its board backing chief executive Eugene Sheehy rose 14c, or 6.93% , to €2.16.