AIB junior bondholders to start burden-sharing challenge
A challenge by junior bondholders to burden-sharing at AIB is to start before the High Court today.
International investors Abadi Securities and Aurelius are trying to stop moves aimed at refinancing the troubled bank.
Finance Minister Michael Noonan secured an order in April allowing AIB to buy back bonds from subordinated bondholders at a massively reduced price.
It also allowed the bank to change the terms and conditions of the bonds such as the date they are due to mature.
The plan was to raise €2bn in capital and take some of the burden of the banking crisis off the shoulders of taxpayers.
This legal action represents a fightback by some of the junior bondholders investors Abadi and Aurelius.
Before the case gets underway, the court is likely to be asked to put back the closing date for the bank to buy back the bonds until after these proceedings are determined.
