The Irish Competition and Consumer Protection Commission (CCPC) has conditionally cleared Bank of Ireland’s acquisition of certain assets of KBC Ireland following a twelve-month investigation into the proposed acquisition.
The transaction will see Bank of Ireland buy KBC’s performing Irish mortgages portfolio as well as commercial and consumer loans and a small number of non-performing loans in order to facilitate KBC's exit from the Irish market.
Following a wide-ranging investigation, the CCPC narrowed its focus on the mortgage market. In particular, the CCPC was concerned about the strength of the ongoing competitive constraint from non-bank lenders on remaining bank lenders in the market.
The clearance decision is subject to a package of commitments. One key aspect of these remedies is a wholesale funding mechanism to underpin the funding capacity of certain non-bank lenders. This will see Bank of Ireland purchasing up to €1 billion in securities from these lenders over the next three years.
The agreed remedies also include funding for mortgage market innovation and honouring certain mortgage conditions for KBC customers on the loans being acquired.
A cross-practice team from Frontier’s competition and financial services practices advised Bank of Ireland throughout the merger clearance process.
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