AIB Loan Portfolio Sale - Why Should AIB Keep The Sale Proceeds ?

[MrEarl]

Hello,

Having read that Cerberus are the successful bidders on AIB's most recent loan portfolio sale, I subsequently heard on the radio that the Bank was going to be retaining the sale proceeds (of €800m, if memory serves correctly).

In my view, the Bank's first obligation should be to repay the State, not to use the funds for other non-essential purposes. The Bank is generating profits, and it is meeting the capital reserve requirements, so there's no urgent need for cash.

So, why do AIB get to retain this cash rather than be compelled to use it to repay some of the debt due to the Irish State (which in turn, should be used to reduce our national debt) ?

 

[Palerider]

Interesting socialist point of view however we are in a capitalist society, your view is surprising assuming you live in the country and understand the fundamentals.

 

[Brendan Burgess]

In my view, the Bank's first obligation should be to repay the State,

Does AIB still have loans to repay the state? From memory, they are all repaid as they were very high coupon.

The state's investment now is through their 75% shareholding. That will be "repaid" through its eventual sale on the market.

Brendan