SHARES IN Allied Irish Banks gained 9 per cent after it emerged that Poland’s treasury ministry may assemble a group of local companies to buy the bank’s interest in Polish lender BZ WBK.
The Polish government is considering putting together a consortium which may include the country's largest bank, PKO, largest insurer PZU and domestic pension and investment funds to buy AIB's 70 per cent stake in the bank, according to a report in Poland's Gazeta Wyborczanewspaper.
The proposal is the idea of Jan Krzysztof Bielecki, a senior economic adviser to Polish prime minister Donald Tusk and a former chief executive of rival Bank Pekao, the country’s second biggest bank. Mr Bielecki reportedly travelled to Dublin to meet AIB to discuss the proposal.
A spokesman for the bank declined to comment.
AIB’s share price climbed 9 cent to 99 cent a share, giving the bank a market value of €874 million.
Bank of Ireland rose 10.5 per cent, or 7 cent, to 73 cent a share.
AIB must raise €7.4 billion to meet the Financial Regulator’s new capital requirements by the end of this year to cover anticipated bad loans and losses on the sale of loans to the National Asset Management Agency (Nama).
AIB plans to sell its interest in Poland, its 22.5 per cent stake in US bank MT and its UK business to meet the capital bill. Analysts estimate that AIB could raise about €4.4 billion from the disposals and will seek to raise further cash by tapping shareholders in a rights issue later this year.
The Government has said that if the bank fails to raise sufficient capital it is “probable” that the State will take a majority shareholding in the bank by converting its existing €3.5 billion investment into ordinary shares and investing further funds if required.
AIB is preparing an information memorandum on the three businesses it plans to sell, and first offers for BZ WBK could be submitted as early as the end of next month, according to sources familiar with the bank’s plan.
The bank must at least agree the sale of the businesses before the end of this year to meet the regulator’s capital requirements.
AIB may need to raise up to €7.8 billion to cover the cost of the capital-raising and the purchase of warrants to limit the State’s future ownership of the bank, according to Eamonn Hughes, analyst at Goodbody Stockbrokers.
“Investors are likely to look for the disposal programme to be well in train prior to looking for equity, so sentiment around this disposal programme is central to the company’s plans,” said Mr Hughes.
The AIB-owned stockbroking firm estimated that the sale of the Polish bank could generate €2 billion in capital, with the sale of the MT stake contributing a further €1.1 billion and the disposal of the UK business releasing up to €1.3 billion.
