1st Nov 2019 09:32
(Alliance News) - Irish banking giant AIB Group PLC on Friday said it has agreed to sell a loss-making loan portfolio for EUR700 million.
The portfolio, which incurred a loss of EUR52 million in 2018, has a value of EUR850 million.
It will be purchased by a consortium including Irish credit management business Everyday Finance DAC and affiliates of American private equity firm Cerberus Capital Management LP.
AIB said: "The proceeds will be used for general corporate purposes including the continuation of support for customer restructuring. The sale is expected to have a negative profit and loss impact but overall will be capital accretive."
AIB, one of Ireland's 'big four' commercial banks, said it is aiming to reduce its exposure to non-performing loan portfolios.
The company added: "AIB has reduced non-performing exposure from EUR31 billion in 2013 to EUR4.7 billion at June 30. The vast majority of this progress was achieved through case by case restructuring and working with customers to rightsize sustainable debt based on customer affordability."
AIB shares were 1.1% higher at EUR2.90 each in London on Friday morning.
By Eric Cunha; [email protected]
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