Michael Noonan keeping his options open on AIB sale

Minister for Finance Michael Noonan yesterday said he is keeping his options open on the sale of part of the Government’s stake in AIB, as markets remain volatile and investors continue to shun bank stocks.

The Government, which controls more than 99% of the lender, has been preparing to sell a portion of its holding for more than a year.

Mr Noonan had planned to sell a 25% stake in the bank to investors before the end of this year, but pushed that plan back to the first half of 2017 citing market volatility.

“My advice is there is no reason why we wouldn’t sell,” Mr Noonan said in a Bloomberg Television interview in London yesterday.

“I’ll sell at the best time. It may be in 2017 but there is no decision yet,” he added.

The IPO is seen as one of the last steps for AIB to move past the financial crisis nearly a decade ago.

The Government pumped €21bn into the bank during the crisis, and has been under pressure to recoup part of that investment.

AIB’s chief executive Bernard Byrne, said, earlier this month, the bank was “fixed” and ready for the Government to start selling its stake.

“There is so much volatility in the market at present, it is impossible to say with any confidence when the Government will be able to start selling down its AIB stake. Having said that, markets can turn very quickly so next year cannot be definitively ruled out,” said Davy Stockbrokers analyst Emer Lang.

Mr Noonan also told Bloomberg that he views the UK’s decision to leave the EU as “a very serious issue” and that if it were not for Brexit Ireland would be looking at “a smooth sea ahead” in its voyage of growth.

He added that there have been numerous enquiries from UK-based companies considering a move to Ireland in the wake of the Brexit decision, but said that no decisions have yet been made.

A survey from corporate law firm William Fry earlier this week suggested that at least 150 London-based financial services firms are considering moving location to long-term EU bases and rank Ireland as a serious potential new home.

Mr Noonan also addressed the City of London Corporation during his visit to the English capital; telling it that the Department of Finance will produce its next official growth forecasts for the Irish economy ahead of the upcoming budget.

In his speech, he said: “We want Ireland to be recognised as the global location of choice for specialised international financial services... To deliver on these objectives, we need to position Ireland as a leading location for... FinTech, payments, data analytics and governance, risk and compliance and aviation finance and leasing.

“In other words, Ireland’s strategic objective is to place ourselves firmly at the cutting edge of financial services innovation.”

Regarding the future EU landscape without Britain, Mr Noonan said: “We will work to protect the key priority areas for Ireland, namely: the economy, Northern Ireland, the common travel area and the EU itself.

“We are already advanced in our preparations to deal with the initial fallout from Brexit and the new paradigm of Brexit will be one of the key factors underlying Budget 2017 with particular reference to competitiveness.”

Additional reporting by Bloomberg