Proposals end fears of majority state ownership

BANK of Ireland has announced details of a proposed €3.42 billion capital raising initiative,effectively ending speculation that it could end up in majority state ownership.

The aims of the proposals are two-fold — strengthening the bank’s capital balance in the aftermath of its relevant loans transferring to the National Asset Management Agency (NAMA) and meeting the end-of-year capital requirements put forward, for all of the NAMA-linked banks, by the financial regulator.

For Bank of Ireland to reach the desired 8% tier-1 capital ratio (from 5.3%), it must raise €2.7bn in fresh funds this year.