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Bank of Ireland stocks fall on Ross share sale

Article By: ,  Financial Analyst
June 10, 2014 1:15 PM

The share price of Bank of Ireland has fallen this morning (June 10th) after billionaire investor Wilbur Ross confirmed he has sold his 5.5 per cent stake in the bank.

Stocks dropped by as much as five per cent in the morning session following the investor's announcement that he is selling up.

Even though Mr Ross insisted that giving up his investment in the bank was not a "negative comment" on the state of the business, investors still responded negatively to the news. Mr Ross is also leaving his position as a director of the bank as a result of selling his stake.

Archie G Kane, chairman of the Bank of Ireland Group, thanked Mr Ross for his investment and for showing faith in the bank when others were doubting the viability of its future in the sector.

He said: "On behalf of the board I would like to thank Wilbur for his contribution, diligence and commitment as a board member. Wilbur was instrumental in the success of the 2011 capital raising and, throughout his tenure, we have benefited greatly from his insights."

Profits made

Mr Ross is believed to have made as much as several hundred million euros as a result of the share sale. When he bought the 5.5 per cent stake in the bank, he paid around 300 million euros (£242 million) for it.

Even though Mr Ross has sold up his shares in Bank of Ireland, it is expected that fellow US investor Prem Wasta is going to retain his stake in the firm. Mr Wasta, who is the founder, chairman and chief executive of Fairfax Financial Holdings, currently has a 5.8 per cent stake in Bank of Ireland, slightly above the percentage held by Mr Ross before the sale.

At 11:27 BST this morning, the share price of Bank of Ireland was down by 4.23 per cent compared to the start of the trading session.

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