AIB has engaged international investment bank Alantra to sell its portfolio of UK small and medium-sized business loans of nearly £ 1bn (€ 1.16bn) as part of a campaign to reduce costs announced at the end of last year, sources said.
Alantra has also been asked to find a buyer for some £ 2.8bn of deposits associated with SME clients across the Irish Sea, although it may have difficulty selling them, since lenders around the world are struggling with excessive levels of customer savings.
AIB chief executive Colin Hunt told analysts last Friday, as the group released annual figures, that advisers had been hired to sell the UK SME portfolio. He did not identify the company involved.
Mr Hunt announced last December that the bank was leaving the UK SME market, while doubling its lending to businesses in niche areas such as renewables, manufacturing and warehousing in that market.
Exiting this labor-intensive market segment will save the bank around 35 million euros in the years to come. The group then reaffirmed its commitment to its activities in Northern Ireland.
Separately, sources say investment bankers at US financial services giant JP Morgan are advising AIB on its plan to purchase a € 4 billion Irish business and SME loan portfolio from Ulster. Bank. Ulster Bank’s UK parent company NatWest Group confirmed last month that it would exit the Irish market in the coming years. Some 300 Ulster Bank jobs are expected to be transferred with the portfolio.
Permanent TSB (PTSB), advised by Morgan Stanley, is also in talks to buy a large part of Ulster Bank’s € 14 billion portfolio and up to € 700 million in loans to small SMEs.
PTSB, which has a network of 78 branches, is also in talks to acquire at least some of the 88 branches of its current rival and hire a number of Ulster Bank’s current 2,200 employees, excluding temporary employees. .
Meanwhile, sources said Ulster Bank had abandoned plans to make 40 compulsory layoffs at the bank, stemming from a plan, announced last September, to cut 266 jobs. Most of the number had been satisfied through voluntary severance pay.
The 40 individuals will be protected from compulsory departure until at least the end of 2021.
Ulster Bank chief executive Jane Howard said at the time that the bank’s liquidation was announced on February 19 that there would be “no new mandatory departures” from the bank lender this year.