Denis O’Brien, the Irish telecommunications and media billionaire, said he would invest in Bank of Ireland Plc as the lender has “cleaned up its balance sheet.”
“Bank of Ireland has taken the medicine,” O’Brien said in an interview with Bloomberg Television’s Maryam Nemazee today at the World Economic Forum’s annual meeting in Davos, Switzerland. While Irish banks have written down their assets to market values and been recapitalized, “other banks around Europe haven’t done a mark-to-market.”
Irish taxpayers pumped about 62 billion euros ($81.5 billion) into the country’s largest six lenders, which have sold risky real-estate loans to the National Asset Management Agency, a so-called bad bank. At the same time, Prime Minister Enda Kenny, who said yesterday that “mad borrowing” lay behind the country’s crash, is cutting spending to narrow the deficit.
“We have taken the cod-liver oil,” said O’Brien, ranked as Ireland’s wealthiest man in the 2011 Sunday Times Rich List. “Ireland is definitely on the turn.”
Bank of Ireland shares fell 0.9 percent to 11.5 euro cents at 2:30 p.m. in Dublin. That’s still 15 percent higher than the 10-cent price at which the lender sold shares in July, and at which the government sold stock to five investors in October.
Former Deputy Chairman
Ireland has injected 4.7 billion euros into the lender since March 2009. The state cut its stake in Bank of Ireland to 15.1 percent by selling a 34.9 percent holding last year to investors including Toronto-based Fairfax Financial Holdings Ltd. and WL Ross & Co., the New York-based investment firm. The bank is now the only domestic bank outside state control.
O’Brien, who controls Caribbean mobile-phone operator Digicel Group Ltd., first generated his fortune from the 2.4 billion-euro sale of Esat Telecom Group Plc to British Telecom Plc in 2000. He now has a 22 percent stake in Independent News & Media Plc, making him the largest shareholder in the Dublin-based newspaper owner.
O’Brien resigned as deputy chairman of Bank of Ireland in September 2006 to focus on his international business interests. He joined the lender’s board as a director in April 2000, according to a bank filing.