State participation Bank of Ireland fell below 5 percent for the first time since the bank’s recapitalization in 2011.
The National Treasury Management Agency (NTMA) sold just over a million shares on Tuesday, reducing its stake to 4.93 percent from 5.94 percent, according to stock market reports.
The transaction would have raised approximately €60 million based on share prices at the time of the announcement.
That puts the government’s sell-off plan on track for a full divestment by the end of the summer if the NTMA maintains a pace of 1pc monthly divestments.
The state is now the third largest shareholder in the banking group, having been the largest in January, Bank of Ireland CEO Francesca McDonagh confirmed in a statement.
By the end of last year, since its €4.8 billion bailout during the financial crisis, the bank had returned €6.2 billion to the state in the form of share sales, coupon payments and fees.
“The ongoing sales process is contributing to those returns and is a positive process for Irish taxpayers, the Irish economy and the Bank of Ireland,” said Ms McDonagh.
“This is also another important step towards normalizing the State’s relationship with the Bank of Ireland.”
Treasury Secretary Paschal Donohoe extended the government’s original six-month clean-up plan last November.
Stock market analysts expect the NTMA to either sell the remaining shares in the market or retain a small stake of up to 3 percent, which sets the threshold for mandatory reporting on Euronext Dublin, in the coming months.
Bank of Ireland’s bid to acquire KBC mortgages worth €9 billion is currently under investigation by the Competition and Consumer Protection Commission (CCPC), which is due to deliver its ruling in May.
The CCPC is understood to be seeking “remedies” from the Bank of Ireland, which could include the sale of some mortgage assets to a competing non-bank lender.
Separately, Bank of Ireland UK, the UK company of the banking group, continued its strategic shift towards higher yield lending by shrinking its loan and deposit books.
The bank increased its underlying pre-tax profit to £335m from £50m a year earlier by cutting operating costs, selling low-margin loans and redeeming customer deposits to reduce funding costs.
Net lending shrank by £5bn, mainly due to the sale of a £2.9bn mortgage portfolio to the parent company. But gross lending was also down by £1.3bn year-on-year as the bank targeted more profitable customer segments.
Meanwhile, the Bank of Ireland’s venture capital arm has invested €1.8 million in Dublin City University’s Pilot Photonics spin-out.
Kernel Capital on Thursday confirmed its investment in the tech start-up, which has patented a technique capable of generating multiple lasers from one device.
Photonics is the science of light and is used in manufacturing, medical devices, telecommunications, security and even food scanning in supermarkets.
The technology was developed through more than a decade of research and development (R&D) at DCU, Trinity College Dublin and the Tyndall National Institute in Cork.
Pilot Photonics is managed by Chief Executive William Oppermann, who founded data storage start-up and kernel capital venture MPSTOR. It was successfully sold to Sanmina Inc. in 2016.
https://www.independent.ie/business/irish/the-states-bank-of-ireland-stake-falls-below-5pc-after-the-latest-share-sale-41484419.html State Bank of Ireland’s stake falls below 5 percent after latest stock sale