Court fast-tracks challenge to AIB order

THE High Court has agreed to fast-track a legal challenge by two New York-based investment firms to the Government’s plan to buy back debt from subordinated bondholders in AIB at a significant discount.

The court has fixed June 2 for the hearing of the case which has implications for the Government’s proposals to recapitalise Irish banks.

The firms are challenging a subordinated liability order (SLO) obtained by Finance Minister Michael Noonan from the court last month in what John Gordon, counsel for Aurelius Capital Management, described as an effort to “beat” the subordinated bondholders into divesting themselves of their bonds in AIB at a “steep” discount.