O’Brien prepared to invest in ‘cleaned-up’ Bank of Ireland

Telecommunications and media billionaire Denis O’Brien said he would invest in Bank of Ireland Plc, as it has “cleaned up its balance sheet.”

“Bank of Ireland has taken the medicine,” said Mr O’Brien in an interview with Bloomberg Television’s Maryam Namezee yesterday at the World Economic Forum’s annual meeting in Davos, Switzerland.

While Irish banks have written down their assets to market values and been recapitalised, “other banks around Europe haven’t done a mark-to-market,” he said.

Irish taxpayers pumped about €62 billion into the country’s largest six lenders, and the banks have sold risky real-estate loans to NAMA.

At the same time, Taoiseach Enda Kenny, who said on Thursday that “mad borrowing” lay behind the country’s crash, is cutting spending to narrow the deficit.

“We have taken the cod liver oil,” said Mr O’Brien, ranked as Ireland’s wealthiest man in the 2011 Sunday Times Rich List. “Ireland is definitely on the turn.”

Bank of Ireland has gained 16% from the 10-cent price at which the lender sold shares in July and at which the Government sold stock to five investors in October.

Ireland has injected €4.7 billion into Bank of Ireland since March 2009. The state cut its stake in Bank of Ireland to 15.1% by selling a 34.9% holding last year to five investors, including Toronto-based Fairfax Financial Holdings Ltd and WL Ross & Co, the New York-based investment firm.

The bank is now the only domestic bank outside state control. The initial wealth of Mr O’Brien, who controls Caribbean mobile phone services Digicel Group Ltd, stemmed from the €2.4bn sale of Esat Telecom Group Plc to British Telecom Plc in 2000.

He now has a 22% stake in Independent News & Media, making him the largest shareholder in the Dublin-based newspaper group.

— Bloomberg