AIB set to fall about €700m shy on repaying fully he State's post-crash bailout
is set to fall about €700 million short of repaying its €20.8 billion taxpayer rescue bill, as the Government turns its attention to realising the value of stock warrants held in the lender after selling its remaining shares in the bank.
Minister for Finance
Paschal Donohoe
confirmed on Tuesday he has sold the State's remaining 2.06 per cent stake in AIB for €305.3 million, bringing the total recovered to date from the bank to €19.8 billion.
The Government also holds stock warrants in AIB which analysts estimate are currently worth about €300 million. Department of Finance officials are considering options for these, including AIB purchasing the warrants back from the State, the Minister added.
'This is an important milestone in delivering on the government's policy of returning the banking sector to private ownership,' Mr Donohoe said.
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The Minister noted that in late 2021, when he went about selling down the State's then 71 per cent remaining stake in AIB, that he said banking should be provided by the private sector, as it involves taking credit risk.
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'It follows that taxpayer funds, which were used to rescue the Irish banks, should be recovered and used for more productive purposes. The gradual disposal of the State's investment in AIB into a rising market has been successful in delivering on this objective for our citizens,' he said.
The total AIB bailout recovery, which also includes proceeds from an initial public offering (IPO) of AIB shares in 2017, redemption of bailout bonds, interest, guarantee fees and dividends received from the bank, is on track to be about €700 million shy or repaying the State on a cash-in, cash-out basis.
However, Mr Donohoe said that taxpayers are currently about €600 million above water on their €29.4 billion rescue of AIB, Bank of Ireland and PTSB. That's because it recovered €2 billion more from Bank of Ireland than the lender's €4.8 billion rescue bill.
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