Ire­land looks to Per­sian Gulf to buy banks

La­hore, Is­lam­abad, Karachi Mon­day, De­cem­ber 13, 2010, Muhar­ram 06, 1432

The Pak Banker - - Front Page -

DUBLIN: Top Ir­ish of­fi­cials have ap­proached Per­sian Gulf sov­er­eign wealth funds to gauge in­ter­est in the sale of Ire­land's banks af­ter the €85 bil­lion (Dh412.26bn) bailout from Euro­pean gov­ern­ments and the IMF.

John Bru­ton, a for­mer Ir­ish prime min­is­ter, is lead­ing a del­e­ga­tion from the coun­try on a whis­tle-stop tour of the re­gion as Ire­land pre­pares to sell as­sets. Ir­ish of­fi­cials are vis­it­ing sov­er­eign funds in the UAE, Qatar, Bahrain and Saudi Ara­bia, where they have al­ready met Prince Al­waleed bin Talal bin Ab­du­laziz Al Saud, the chief of King­dom Hold­ing and one of the world's 20 rich­est men. Mr Bru­ton is the head of the In­ter­na­tional Fi­nan­cial Ser­vices Cen­tre in Ire­land, which aims to at­tract fi­nan­cial com­pa­nies to set up there.

"The mes­sage was ' our banks are for sale to any in­vestors, for­eign or lo­cal'," said one ex­ec­u­tive at a UAE sov­er­eign wealth fund who met the del­e­ga­tion this week.

The visit fol­lows re­cent sim­i­lar trips made by groups from Greece and Spain seek­ing in­vest­ment in ail­ing fi­nan­cial in­sti­tu­tions.

Mr Bru­ton said yes­ter­day he was not rep­re­sent­ing the Ir­ish govern­ment in an of­fi­cial ca­pac­ity but dis­cussing the gen­eral sit­u­a­tion and op­por­tu­ni­ties in the coun­try, in­clud­ing the po­ten­tial sale of banks and bank as­sets.

"We are not here to fa­cil­i­tate the sale of any as­sets or start any ne­go­ti­a­tions," said Bru­ton. "That is the govern­ment's de­ci­sion and role, but ob­vi­ously dis­cus­sions have taken place about the Ir­ish econ­omy gen­er­ally. The cen­tral bank has clearly said as­set sales are be­ing stud­ied."

While the dis­cus­sions were in­for­mal, he said they could pro­vide the ba­sis for ne­go­ti­a­tions be­tween Ire­land and the Per­sian Gulf's wealth­i­est in­vestors for fu­ture as­set sales. Oth­ers on the trip in­cluded of­fi­cials from Ire­land's In­dus­trial Devel­op­ment Agency. Bru­ton's meet­ings come as Ire­land faces in­creas­ingly stark eco­nomic chal­lenges fol­low­ing the Celtic Tiger boom years in which the econ­omy ex­panded rapidly be­tween 1995 and 2007 be­fore un­rav­el­ing be­cause of ex­ces­sive pub­lic and pri­vate-sec­tor bor­row­ing and the col­lapse of prop­erty prices.

Fitch Rat­ings yes­ter­day down­graded Ire­land's sov­er­eign rat­ing to "BBB-plus" from "A-plus" af­ter ac­count­ing for the ad­di­tional costs of re­struc­tur­ing its strug­gling econ­omy and bank­ing sec­tor.

To re­duce its debt, Ire­land has em­barked on se­vere bud­getary cost cut­ting and is draw­ing up a list of as­sets it could sell to raise cash.

Its trou­bled banks, in­clud­ing An­glo Ir­ish Bank, Bank of Ire­land and Al­lied Ir­ish Banks, have sold a large por­tion of their loan books to a con­tro­ver­sial govern­ment ve­hi­cle, the Na­tional As­set Man­age­ment Agency. -PB News

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