(Corrects bracketed word in penultimate paragraph to "state's",
* Pair invested when shares had fallen to 10 cents
* High of 39 cents reached this year
* Shares down 7 pct after announcement of stake sale
* State holds 14 pct, has said in no rush to sell
By Padraic Halpin
DUBLIN, March 4 Two of Bank of Ireland's
largest shareholders, Wilbur Ross and Fairfax Financial
, began selling a combined 6.4 percent stake in the
country's largest lender on Tuesday, the placing's bookrunner
Deutsche Bank said.
Billionaire investor Ross and Fairfax boss Prem Watsa were
among a group of North American investors who kept the bank out
of state hands in 2011 when they bought a 35 percent stake only
months after Ireland signed up to an EU/IMF bailout.
The group invested in the bank, in which the state holds a
14 percent stake, when the share price stood at about 10 cents.
The shares have risen significantly since then, jumping 120
percent last year and hitting a high of 0.39 euros this year.
The shares were down 6.9 percent at 0.34 euros by 1025 GMT
on Tuesday, having slipped 7 percent on Monday after publication
of its full-year results.
Bank of Ireland said it returned to profit in the first two
months of the year and had cut its full-year loss by almost two
thirds in 2013 thanks to improved margins and a fall in the
number of homeowners in arrears. The shares had risen by 25
percent in the month before the results.
Ross owned more than 2.9 billion Bank of Ireland shares, or
9.1 percent of the bank, before Tuesday's announcement. Fairfax
held 2.8 billion shares, or 8.7 percent.
Fairfax has since gone on to invest in Greece, announcing an
increase in its stake in property company Eurobank Properties in
October, while Ross told Reuters last year that he was keen on
financial assets in Spain, another distressed euro zone market.
Deutsche Bank said the accelerated bookbuilding of the 2.1
billion euros of shares on offer was open to institutional
investors only and that Ross and Fairfax had agreed not to sell
any more shares for 90 days.
The pair were the second and third-largest shareholders in
the bank behind the government, which also holds more than 99
percent of rival lenders Allied Irish Banks and
Ireland's Finance Minister Michael Noonan told Reuters in
December that while the government had no interest in running
banks in the long term, it was under no financial or political
pressure to sell.
"I'd be surprised to see the government announce imminent
plans to divest its residual Bank of Ireland equity stake,"
Merrion Stockbrokers analyst Ciaran Callaghan said.
"Given the (state's) strong cash buffers, the state is not
under any pressure to monetise its investment. I would expect
them to weigh up the market's reaction to the North American
disposal before forming any concrete plans."
A spokesman for the finance ministry on Tuesday said that
its strategy remained unchanged and the government would reduce
its shareholdings in the banks at the right time.
($1 = 0.7260 euros)
(Additional reporting by Freya Berry in London; Editing by