AIB could raise €2bn in buyback

AIB could secure close to €2 billion of the €6.1bn in capital it needs to raise by the end of February by buying back loan notes, at a 70% discount, from the holders of €4.1bn in the bank’s debt.

Jumpy loan note titleholders among the owners of €4.1bn in subordinated debt issued by Allied Irish Bank had until Friday last to signal their intention to accept the deal. The offer was broadly in line with current values of the loan notes on secondary markets.

Initially, the bank had hoped to raise about €1.3bn, but a high uptake of the offer is expected to push the capital gain for the bank to close to €2bn.