Bank of Ireland takeover of RBS would make sense
You report (News, June 3) that the Chancellor will announce plans for Royal Bank of Scotland in his emergency "summer Budget" next month.
Richie Boucher, the chief executive of the Bank of Ireland, has recently suggested that there may be some consolidation of the banking sector in the United Kingdom.
Given his own previous experience at the Royal Bank of Scotland, and also given that the British Government is reportedly about to offload this bank at a discount, it would make sense for the Bank of Ireland to make a takeover offer for Royal Bank of Scotland.
The National Treasury Management Agency recently sold €750m of seven-year bonds at a yield of only 0.81% and one would expect Bank of Ireland to be able to get a similar ultra-low rate if it wanted to raise circa £30bn towards a bid for RBS.
In return, Bank of Ireland would get a major stake in a British bank that controls Citizens Bank in the USA and also gain control of Ulster Bank, which is the third largest bank in Ireland.
Bank of Ireland might be considered a minnow in relation to RBS, but it wouldn't be the first to take over a larger rival.
Moreover, if it wanted to, it could link up with Allied Irish Bank to make a joint bid, in which Allied gets Natwest.
These opportunities rarely come along and this would appear to be a no-brainer.
BERNARD J MULHOLLAND