BoI confident commission will approve restructuring

BANK of Ireland is confident that the European Commission will approve its altered restructuring plan, allowing it to retain ownership of the well-performing ICS Building Society.

BoI confident commission will approve restructuring

The disposal of the ICS and New Ireland Assurance formed part of the company’s original restructuring plan, but management now wants to keep ICS and park the sale of New Ireland for 12 months.

While no approval decision is pending from the EC, Bank of Ireland chairman Pat Molloy told shareholders at the company’s annual general meeting in UCD yesterday that management “doesn’t envisage having to sell ICS within the next 18 months”.

Mr Molloy said that ICS has a “very solid and durable deposit base”.

“In the times we’re currently living in, that represents a very valuable asset.”

Bank of Ireland’s chief executive Richie Boucher also told shareholders that the bank should continue to make “good progress” on the disposal of non-core assets over the next 12 months.

Mr Molloy reiterated that deposit outflows have stabilised and management is confident of “significantly exceeding” its 10.5% minimum core tier-1 capital ratio target, as set out by the Central Bank.

He also said that the bank is continuing to look at other sources of private capital. Shareholders are due back at UCD to vote on the bank’s recapitalisation plans next month.

Meanwhile, Mr Molloy told shareholders he “very much” wished “we could turn the clock back”, regarding its reckless lending spree, but added that the current management team is making progress on its key growth initiatives.

“Despite the difficult environment, we remain focused on driving changes within the business, so that the group is well-positioned to deal with these challenges and for future economic recovery. The group’s strategy is to continue to make a meaningful impact on our de-leveraging initiatives and revert to a more traditional retail banking funding structure with loan portfolios substantially funded by customer deposits,” he told yesterday’s meeting.

Bank of Ireland’s share price — which has already fallen by nearly 70% this year — was unmoved at 13c yesterday. The bank also announced that Paul Haran, Dennis Holt and Heather Ann McSharry had retired as non-executive directors and Des Crowley and Denis Donovan had retired as executive directors following yesterday’s meeting.

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