The State has cut its shareholding in AIB Group to 12.5% from 17.5% and may exit the bank completely this year, the Finance Minister Paschal Donohoe said today.
The Government cut its stake via a placement to institutional investors, yielding €652m at a price of €5.60 per share, Mr Donohoe said in a statement.
"It is now a realistic target that the state could exit its position in AIB later this year should market conditions allow," he added.
Ireland effectively nationalised AIB in 2010 when it pumped €64 billion, or almost 40% of its then annual economic output, into the country's banks after a huge property crash.
The Government spent €21 billion to bail AIB out and Paschal Donohoe said the Government has to date recovered €17.9 billion.
The Government has been gradually selling down shares in AIB since 2021 following a 2017 IPO.
It sold its last shares in Bank of Ireland in 2022.
This latest transaction is the State's sixth such disposal in AIB and when settled, the proceeds will be returned to the Ireland Strategic Investment Fund pending further consideration by the Minister for Finance.
Paschal Donohoe said the latest transaction achieved a price which was 14% higher than what was achieved in the previous transaction last June.
"Once again, this transaction was well received with significant demand from a large number of high quality international institutional investors," the Minister said.
"We have made significant progress in reducing the State's shareholding in AIB from c. 71% at the beginning of 2022 to c. 12.5% today. It is now a realistic target that the State could exit its position in AIB later this year should market conditions allow," he added.
AIB Group chief executive Colin Hunt said the bank very much welcomed the decision and subsequent transaction undertaken by the Minister for Finance, which has led to a further divestment of the State's shareholding in AIB Group.
"This well-supported transaction is another important milestone in the process of returning the State's investment in the group and a normalisation of the share register," Colin Hunt said.
"It will return a further €652m to Irish taxpayers to whom AIB is deeply grateful, for their support during the financial crisis. This brings the total proceeds returned to the State to c. €18 billion," the CEO added.
Colin Hunt said that 2024 was the first year of the bank's new strategic cycle and it made strong progress in each of its three focus areas: Customer First, Greening our business and Operational efficiency.
"Our business performance is underpinned by a supportive domestic economy, our leading customer franchise, competitive market positioning, growing loan book and resilient and diversifying income," he said.
"We look forward to continuing to support our customers, generating shareholder value and delivering our 2024 Annual Financial Results on 5 March," he added.
Shares in the bank were lower in Dublin trade today.
