views

Allied Irish Bank receives an approach to sell minor stake

ALLIED Irish Bank is believed to have received an approach from Canadian Imperial Bank of Commerce which wants to take a minority stake in the lender.<br /><br />The Irish institution had earlier said it received an approach from a third party. Earlier this month Allied Irish said it was over the worst of the financial crisis despite reporting a surge in bad debts that pushed the company deep into the red.<br /><br />The bank posted first-half losses of &euro;872m against a profit of &euro;1.3bn a year earlier after being hammered by the collapse of the Irish property market. It wrote off &euro;2.37bn of loans in the first six months of 2009, compared with &euro;137m a year earlier. However, Allied Irish said it was sticking with its estimate of a &euro;4.3bn in bad debt charges for the full year.<br /><br />Ireland&rsquo;s government has set up a so-called &ldquo;bad bank&rdquo; to purge the financial sector of risky property assets. Allied Irish is expected to shift between &euro;16bn and &euro;25bn of loans into the proposed National Asset Management Agency.<br /><br />Allied Irish has also said there are no plans to offload its main overseas operations in the US and Poland. The bank has already raised &euro;1.1bn of additional capital using a bond swap and the group could raise up to &euro;400m more without asset disposals.