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Goldman Sachs, CarVal, Bank of Ireland win £2.6bn Poseidon

Goldman Sachs, CarVal and Bank of Ireland have bought a portfolio of Irish commercial loans from Lloyds Banking Group for £827m. The loans, made to small and medium sized businesses in Ireland, are mostly secured against commercial property.

Goldman Sachs, CarVal and Bank of Ireland have bought a portfolio of Irish commercial loans from Lloyds Banking Group for £827m.

The loans, made to small and medium sized businesses in Ireland, are mostly secured against commercial real estate.

The sale, named Project Poseidon, saw gross assets valued at about £2.6bn disposed. About £2.3bn were impaired.

Lloyds logo CROPPEDThe proceeds from the sale will be used for general corporate purposes.

Lloyds said: “The sale is in line with the group’s strategy of deleveraging its balance sheet by reducing run-off assets and creating a low risk, UK focused bank.”

Following the sale, Lloyds’ remaining exposure to commercial assets in Ireland will be less than £30m.

As at 30 June 2015, impaired loans as a percentage of closing advances for Lloyds were 2.7%. Provisions as a percentage of impaired loans were 55.1%.

The assets generated a pre-tax losses of around £130m in 2014. The sale is not expected to have a material impact on Lloyds but will be capital accretive by around 7bps.

The sale is expected to complete in Q4 of 2015.

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