Bank of Ireland equity investment ‘talks over’

DUBLIN: The Irish government on Saturday said it was in talks with potential equity investors in Bank of Ireland as it struggles to keep its last major bank out of state control.

If the lender cannot find an investor or persuade its largely retail shareholder base to participate in a 1.91 billion euro ($2.8 billion) rights issue then the state, which is underwriting the offer, could end up with a 70 percent stake.

"The State is in discussions with potential equity investors in Bank of Ireland in relation to a possible material investment in the bank," the Department of Finance said in a statement.

"As at the time of this announcement, these discussions continue and may or may not lead to a transaction."

Dublin has closed two of its six domestic lenders, merged another two state-controlled institutions and will soon take over a fifth as it seeks to draw a line under a banking crisis that forced the former Celtic Tiger economy into an EU-IMF bailout.

Copyright Reuters, 2011