Group expects to be ‘investable’ by 2017

Permanent TSB chief Jeremy Masding has said 2016 to 2017 is a realistic target date for the sale of the state-controlled bank, despite it being unlikely the entire group will be profitable by that stage.

Speaking after a fractious AGM yesterday, he noted progress made by the pillar banks and how private capital still seems attracted to Ireland and said “we’d like to think we’ll have an investable entity, by then, so I don’t see why it wouldn’t be realistic”.

On the rumours of a merged Permanent TSB/Ulster Bank entity forming a strengthened “third force” in Irish banking, Mr Masding said there has been no talks between the banks on the issue. He added that there was no update from Brussels regarding the formal approval of PTSB’s restructuring plan.

While PTSB’s “good bank” element has returned to profitability, on a group basis (including its bad loan asset management arm) it is unlikely to be profitable before 2017.

Mr Masding said he was comfortable with the target scenarios being set out for the new banking stress tests, but said it was “way too early” to know how PTSB will fare.

Earlier, addressing shareholder concerns regarding the bank’s survival chances, PTSB chairman, Alan Cook said management was not aiming to close the bank, but was “100% focused” on creating a successful trading organisation.

“We are fighting for survival and are doing a pretty good job,” he added.

He said that the ultimate goal was to exit state ownership, adding that this could come via a number of ways including a trade sale, a stock market flotation or a private equity deal.

PTSB’s management had to contend with a number of issues at yesterday’s AGM. Less than 10 minutes into proceedings there was an attempt to adjourn it by a group of shareholders challenging the State’s effective takeover of the bank via the courts. This was followed by questions about dwindling employee pension entitlements, the €40m annual interest the bank is paying on its contingency loan from the Government, and the potential for dividend payments.

On the latter two issues, Mr Cook said that the interest payments represented “money well spent for that security” and that there was “little prospect” of any dividend payouts in the short term.