Irish Bank Resolution Corporation (IBRC)
Blackstone Advisory Partners, the advisory division of the Blackstone Group, are reported to have been retained by Irish Bank Resolution Corporation (formerly Anglo Irish Bank) to assess its remaining Irish and UK loans, valued at approximately €30 billion. IBRC has reportedly confirmed that the retainer will not preclude the investment division of the Blackstone Group from bidding for any portion of its loan book.
In related news, IBRC is also reported to have withheld almost one tenth of performing loans when it sold its US loan book last year to US bank Wells Fargo, JP Morgan and Lone Star. The loans are understood to have been withheld as customer approval was required for a sale. (To view a previous article on this, please click here).
Lloyds & Bank of Scotland Ireland
Lloyds Banking Group has reported a pre-tax loss for 2011 of £3.5 billion (€4.1 billion). Its 2011 results also show that two thirds of its total Irish loan book of £24.7 billion is now impaired, with a 90% impairment of its Irish commercial loans (£10.87 billion) and a 20% impairment of its Irish mortgage book (£7 billion). Its total impaired loans in Ireland are now valued at £16.4 billion, an increase of £1.9 billion on last year. Lloyds is in the process of winding down its Irish subsidiary, Bank of Scotland Ireland (BOSI), the loans of which are now being managed by an independent company, Certus.
The group is also reported to have recently taken control of Heuston South Quarter, a residential and commercial development close to Dublin’s Heuston Station. Receivers have reportedly been appointed to Rhatigan Commercial Developments and Shoreview, joint venture companies that acquired the site in 2005 for €80 million in a deal partly financed by BOSI. It is understood that a debt of almost €257 million is secured against the property.
Receivers have also been appointed by the group to the Burlington Hotel in Dublin, the Parknasilla Hotel in Co Kerry and the Cork International Airport Hotel on foot of a debt of €200 million owed by developer, Bernard McNamara. McNamara is reported to have acquired the Burlington Hotel in 2007 for €288 million and the Parknasilla Hotel in 2006 for €40 million with finance from BOSI.
AIB and Permanent TSB
Plans to move loss-making tracker mortgages (cumulatively valued at €34 billion) off the balance sheets of AIB and Permanent TSB are advancing. It is reported that the Government and the EU/ECB/IMF are evaluating the possible creation of a Government bond for use as security for a low interest loan from the European bailout fund. Under this proposal the bond would be available to IBRC to exchange for AIB and Permanent TSB’s tracker loans. IBRC would then use the tracker loans to borrow money from the European Central Bank.
AIB is understood to have retained Morgan Stanley to advise on the possible disposal of a commercial real estate loan portfolio valued at approximately €800 million, which it acquired when it merged with the Educational Building Society last year. The portfolio comprises retail (49%), office (40%) and hospital (10%) properties.
Irish Life & Permanent is reported to have agreed a sale of Permanent TSB’s agri loan book valued at €60 million to De Lage Landen, a subsidiary of Rabobank. Davy Corporate Finance is understood to be advising on the sale of the remainder of PTSB Finance, including its car loan book valued at €500 million. However, IL&P has reportedly suspended the sale of its UK loan book (€8.1 billion) and cancelled the sale of its subprime mortgage book (€500 million).