Progress on AIB’s Polish bank sale

POLAND’s Bank Zachodni has said it has held four meetings with potential buyers of AIB’s controlling interest in the company, but declined to say if the sale process was close to conclusion.

The sale of AIB’s 70% stake in the institution is seen as a key element of its overseas asset disposal programme and, as such, its efforts to reach its €7.4 billion post-NAMA end-of-year 8% tier-one capital ratio requirement, put in place by the Financial Regulator and the Government in March.

Management at Zachodni spoke sparingly on the sale process, on the back of its quarterly results announcement yesterday. They also declined to clarify if the four meetings were held with four individual suitors or if any interested party had been met more than once.

The likes of HSBC, Spain’s Santander, France’s BNP Paribas, US-based private equity house Apax Partners and Italian banks Unicredito and Intesa Sanpaolo have been linked to AIB’s Polish business. While recent reports suggested the Italian banks and HSBC had pulled out rumours of Intesa ending its interest seem premature given that it said, yesterday, it is conducting due diligence on Zachodni.

The Italian bank is the only one to comment on its link with Zachodni.

Poland’s other big banks — PKO Bank Polski and Bank Pekao — have also been linked with a move for the asset and are seen as among the favourites as the country’s government aims to lower the level of foreign ownership in its banking system. That would spell concern over the potential of AIB to raise the €2bn it hoped for from the sale.

Zachodni reported a 1.57% year-on-year fall in net profit for the second quarter of the year to 250 million zlotys (€62.5m), due to higher impairment provisions for non-performing loans.

For the three month period, the bank’s impairment losses amounted to 146m zlotys (€36.5m).

AIB’s share price fell by 1.16% — or 1c, in monetary terms — to 94c, yesterday.