The state completed the sale of its stake in the Bank of Ireland.
Finance Minister Pascal Donohue said this development is an important milestone in the implementation of the government’s policy to return the banking sector to private ownership.
In total, 841 million euros were obtained through the process of the trading plan, which lasted for several months.
During the last third phase of the process, the shares were sold at an average price of €6.17 per share.
This represents an increase from 5.64 euros per share realized in the second phases and 4.96 euros in the first phase.
“When I announced the launch of the stock trading scheme in June 2021, I commented that banking is an activity that involves credit risk and therefore should be offered by the private sector,” said Pascal Donohue.
It follows that the taxpayers’ money which was used to save the Irish banks, must be recovered and used for more productive purposes.
“The phase-out of state investment in the Bank of Ireland into a bull market has been successful in achieving this goal for our citizens.”
In all, the country has now recovered €6.7 billion from the Bank of Ireland’s €4.7 billion bailout.
This rescue plan took place between 2009 and 2011 at the height of the global financial crisis.
This development represents an important event for the Bank of Ireland, as it gives it independence in decision-making.
However, the government has not made clear whether the pay restrictions on bankers will continue to apply to the Bank of Ireland now that the state’s involvement in it has ended.
These wage caps also apply to the permanent AIB and TSB, of which the state remains a major contributor.
“We have also made significant progress in terms of our investments in PTSB and AIB, which are still worth over €4.9 billion combined despite various dispositions this year,” Minister Donohue said.
“Our stake in PTSB is expected to decline from 75% to approximately 62.4% later this year when the bank issues new shares in a partial exchange for the Ulster business that it has agreed to purchase from NatWest Group Plc.”
Meanwhile, in AIB, the largest remaining investment for the state, our stake decreased from 71.2% to 63.5%.
The sale of Bank of Ireland shares began in June of last year.
At that point, the state owned 13.9% of the lender.
In order to ensure that the interests of taxpayers are protected, shares are not sold at less than a certain share price.
The Bank of Ireland welcomed today’s announcement that the country no longer holds any ownership of the group.
“The completion of the sale of state shares in Bank of Ireland is a very positive moment for Irish taxpayers, the Bank of Ireland, and for the sector as a whole,” said Gavin Kelly, interim CEO of Bank of Ireland Group.
“The Bank of Ireland should never have needed taxpayer support. We will always be grateful for the help we have received.”
“This is a defining moment for the Bank of Ireland as we move decisively beyond the financial crisis, and it is a very important step towards the full normalization of our relationship with the state,” Kelly said in a statement.