LONDON, Dec 3 (IFR) - Bank of Ireland is close to
launching new shares and debt that will repay EUR1.8bn of
state-owned preference shares that the bank had to issue as part
of its 2009 bailout, according to market sources.
Both components could be launched as early as Wednesday,
with the equity portion expected to be EUR500m in size and the
remainder to be issued in debt, the sources said.
Bank of America Merrill Lynch, Credit Suisse, Davy, Deutsche
Bank and UBS are heard to be bookrunners on the deal, but they
either declined to comment or were not immediately available.
Bank of Ireland was not immediately available to comment.
BoI, which is 15% state-owned, said last month that it might
sell new shares to help repay the preference shares.
"Such options could include the bank facilitating a
potential sale by the state of 2009 preference shares to private
investors, and some element of ordinary stock issuance to redeem
a portion of the 2009 preference shares," it said.
A successful transaction would be a milestone for the bank,
the banking sector and for the Irish government ahead of its
expected exit from an EUR85bn international bailout this month.
Repaying the shares ahead of a coupon step-up next year
would also mean lower interest costs.
The Irish state sold a EUR1bn contingent convertible (CoCo)
bond it held with the bank in January, and would be left with
just a residual equity stake when the preference shares are
That CoCo, led by Davy, Deutsche and UBS, attracted almost
EUR5bn of orders, allowing leads to double the size of the issue
from an initially targeted EUR500m deal.