It has been reported that AIB shares has fallen dramatically after the Minister for Finance Michael Noonan strongly advised against investing in the State-owned bank.
Mr Noonan made the damaging comments whilst he was speaking about the Government’s plans to eventually return AIB to private ownership, Mr Noonan reckoned that banks current structure of its shares meant it was considerably overvalued at around €55bn. He said this would need to change before the bank returned to private ownership, Mr Noonan also made a stark warning to those investing in the bank would lose money.
Since Mr Noonan’s comments the banks shares fell by almost 21.8% although they did rebound later yesterday afternoon to close 13.6% lower than the original figure. The news means that with the current low price of an AIB share, it makes it particularly susceptible to large percentage changes.
When asked about plans for the bank’s future ownership Mr Noonan said officials at his department, along with others, are working on a blueprint to get AIB back into private ownership.
Mr Noonan said it was always Government policy that the arrangement where the Government would hold all the shareholding in AIB was temporary and the plan was to restore it to private ownership over time.
However Mr Noonan said he was not announcing the imminent sale of AIB, but said the process of setting out a blueprint for that to happen has started. He claimed that the process would take a number of years,. Although he said there will be further announcements on it leading up to Christmas.