26th May 2015 17:23
LONDON (Alliance News) - Royal Bank of Scotland Group PLC Tuesday said it has agreed to sell a loan portfolio to Cerberus Capital Management LP at a loss, with the sale being the last "material" transaction for the part of the group running down bad or unwanted assets in Northern Ireland.
In a statement, RBS said it will receive GBP205 million at current exchange rates for the sale, with the deal expected to complete in June, as RBS Capital Resolution continues to sell billions of pounds in assets with high capital intensity or risks.
RBS said the sale of the loan portfolios was in addition to the disposal of a portfolio of Irish real estate loans to Cerberus in December.
"The disposal of this portfolio represents the final material transaction for RBS Capital Resolution (RCR) in Northern Ireland," RBS said in a statement.
The proceeds will be used for "general corporate purposes".
"This transaction forms part of the continued reduction of assets in RCR and is in line with the bank's plan to strengthen its capital position and reduce higher risk exposures," RBS said.
The loans had a carrying value of GBP205 million at the end of 2014. Gross assets amount to GBP1.4 billion and the loans generated a loss of about GBP16 million in 2014. The sale is expected to result in a GBP5 million loss after costs.
RBS shares closed down 1.5% at 349.72 pence on Tuesday in London.
By Samuel Agini; [email protected]; @samuelagini
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