8. Directed Investments
The Agency holds Directed Investments subject to directions given by the Minister for Finance pursuant to section 43 of the NTMA Act 2014. The holding and management of the Directed Investments, the exercise by the Agency of voting and other rights attaching to the Directed Investments and the disposal by the Agency of the Directed Investments must be conducted in accordance with any directions given by the Minister for Finance.
8.1 Directed Investments valuation
| 2017 Unit Millions |
2016 Unit Millions |
Valuation (€) 2017 Per Unit |
Valuation (€) 2016 Per Unit |
2017 €m |
2016 €m |
|
|---|---|---|---|---|---|---|
| Bank of Ireland (BoI) | ||||||
| Ordinary Shares 1 | 150 | 4,512 | 7.124 | 0.234 | 1,072 | 1,056 |
Allied Irish Banks (AIB) |
||||||
| Ordinary Shares 2 | 1,930 | 2,711 | 5.421 | 4.277 | 10,465 | 11,595 |
Total directed investments assets |
11,537 |
12,651 |
||||
Cash (Note 12, 14.3) |
215 |
215 |
||||
| SBCI Loan (Note 14.3) | - | 25 | ||||
| Total directed investments | 11,752 | 12,891 |
- 1The valuation of BoI ordinary shares is based on quoted bid prices. BoI carried out a share restructure during 2017 to consolidate the number of its shares in issue; the Fund’s % shareholding of 13.95% remains the same as at 31st December 2016.
- 2Given the Fund’s ordinary share holding in AIB as at 31st December 2016 (99.9%), the Agency engaged EY to provide an independent fair value of the investments. However, as AIB underwent an Initial Public Offering (“IPO”) in June 2017, the Fund’s holding at 31st December 2017 is based on quoted bid prices. At year end, the Fund’s holding in AIB was just over 71% due to the Fund disposing almost 29% of its shareholding as part of the IPO.
8.2 Directed investment valuation movement
| Bank of Ireland | 2017 €m |
2016 €m |
|---|---|---|
| Opening valuation | 1,056 | 1,525 |
| Investment gain/(loss) during the year | 16 | (469) |
| Closing Valuation | 1,072 | 1,056 |
| Allied Irish Banks | ||
| Opening valuation | 11,595 | 12,236 |
| Disposal of ordinary shares | (3,434) | - |
| Investment gain/(loss) during the year | 2,304 | (641) |
| Closing Valuation | 10,465 | 11,595 |
As part of the AIB IPO in June 2017, the Fund disposed of 780,384,606 shares for proceeds of €3.43bn. These proceeds were subsequently transferred back to the Exchequer (See note 11.2).