Union urges Stormont to halt First Trust fire sale
Issued : 20 May 2010
Belfast Telegraph
Union officials have urged MLAs to lobby to save the First Trust Bank from a potential "fire sale".
First Trust's Dublin-based parent company Allied Irish Bank last month shocked staff when it put its business in Northern Ireland, Great Britain and Poland up for sale in a bid to help raise the €7.4bn of capital it needs in order to avoid being taken into State ownership.
Larry Broderick, head of financial sector union IBOA, told the Stormont Finance Committee yesterday that the decision had been taken with no regard to the economic implications for Northern Ireland.
"AIB Group's future relies on its ability to raise over €7bn in capital. The Government in the Republic has indicated that it is prepared to meet any funding shortfall, though clearly it would like to minimise this. Nevertheless it is widely expected that the Irish state will have been required to take a 70% stake in the group by the end of this year.
"Given the depressed state of the financial services sector, it is highly unlikely that the sale of First Trust would make a significant difference to the overall level of state ownership. It certainly will not reduce it to less than 50%. Under these circumstances, we cannot understand why AIB Group would persist with a fire sale which would not only be bad news for bank workers but also bad news for the economy of Northern Ireland."
Mr Broderick said if First Trust was purchased for a knockdown price it would inevitably result in a substantial number of its 1,500 employees losing their jobs.
Ulster Unionist MLA David McNarry, the committee's deputy chair, said its members were very concerned about the threat to jobs.
He said: "The committee was quite unanimous that this needs to be taken forward and that we'd recommend the Executive looks at this issue, to relate it to the government in London and to the Irish government to see what their intentions as a shareholder are."
"My anxiety would be that there is a cut and run philosophy behind this by Allied Irish Bank," he added. "We saw what happened with Quinn Insurance and now this, and I wonder where there is boardroom control outside Northern Ireland whether we need to look at just how effective the consultation is with Stormont."
Spanish group Santander is currently in negotiations to buy AIB subsidiaries in Poland and GB, but there have been no clear expressions of interest in First Trust.
Symon Ross
