AIB to pay back bailout funds

Allied Irish Banks (AIB) won regulatory approval on Friday to pay 1.7 billion euros ($1.9 billion) of government bailout funds, beginning the process of repaying the 21 billion euros it received during the 2008-9 financial crisis. Ireland pumped a total of 64 billion euros into its banks during the crisis, which, at almost 40 percent of annual economic output, was the most expensive rescue in the euro zone. State-owned AIB's rescue was the biggest bailout given to any Irish bank still trading. AIB has been in discussions with European regulators about reorganising its capital structure, including how much it can repay the government from the 3.5 billion euros of preference shares it owns in the bank. Taking account of income due from the bank and 1.6 billion euros worth of state-owned contingent capital notes (CoCos) due to mature next July, Ireland will receive close to 4 billion euros ahead of a potential initial public offering (IPO) next year, Finance Minister Michael Noonan said. "The changes announced today lay the ground-work for the Irish taxpayer to ultimately recover the full value of their 20.8 billion euro investment in AIB," Noonan said in a statement.