April, 22, 2010

Bank of Ireland (BKIR.I) has started talks with investors on a plan to raise 2.7 billion euros ($3.6 billion) of capital featuring a rights issue which should leave the state as a minority owner.Ireland's biggest bank by market value needs to raise the capital to satisfy new regulatory requirements and compensate for writedowns on discounted loan transfers to the National Asset Management Agency (NAMA), a "bad bank".

Bank of Ireland said it was considering a combination of a rights issue, an institutional investor placing, a conversion of part of the state's preference shares into ordinary equity and "liability management", which usually refers to buying back or swapping cheap debt to raise capital."Based on the current envisaged structure, the bank expects that the state would continue to be a minority shareholder in the bank," Bank of Ireland said in a statement.

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