Myles O’Grady, Group CEO at Bank of Ireland. Photo: Naoise Culhane
The last vestiges of the UK’s Bristol & West building society – acquired in 1997 by Bank of Ireland – are to vanish.
The building society was founded in 1850 and was Britain’s ninth-largest with 1.1 million customers when it was bought.
It no longer trades under the name, but shares in Bristol & West do.
Now Bank of Ireland has said it will redeem £32.5m (€37.9m) in Bristol & West preference shares and then consign the institution to history through a members’ voluntary liquidation.
The tender offer for the preference shares has settlement dates in July and August.
The tender offer is part of the Bank of Ireland group’s process to optimise its capital structure, to achieve among other things, a retirement of inefficient legacy perpetual instruments which no longer qualify as regulatory capital while also providing liquidity to preference shareholders,” according to Bank of Ireland.
The bank is offering to purchase the preference shares for 117.5pc of their face value. It’s also offering a payment in lieu of a dividend, with the amount payable dependent on whether a share owner validly submits their tender instructions before or after a general expiration deadline.
After that, Bank of Ireland will move to liquidate Bristol & West.
“Bristol & West is no longer an active banking entity and has no other material assets or liabilities apart from the preference shares,” it noted.
It added: “The Bank of Ireland group’s ultimate intention, following the tender offer, is to wind up Bristol & West through a members’ voluntary liquidation process. This would mean that Bristol & West would cease to exist.”
A liquidation of the firm is conditional on the receipt of approval of 75pc of Bristol & West’s shareholders present and voting at a general meeting.
If the liquidation is validly approved, the holders of preference shares at that tine who have not accepted the tender offer are expected to receive a cash distribution from the liquidation proceeds.
Bank of Ireland announced in 1996 that it had signed a deal to pay £600m to buy Bristol & West, which was sold amid a rush by British building societies to demutualise and become banks.
Each of its members was due to get a cash windfall of £1,000 as a result of the sale.
