Bank of Ireland Group plc (the ‘’Group’’) – Sale of UK credit cards portfolio

28 June 2019

As set out at the Investor Day in June 2018, and with a focus on increasing returns in our UK business, the Group undertook a strategic review of the UK credit cards business. Today, the Group announces that it has, through Bank of Ireland (UK) plc, agreed to sell the existing UK credit cards portfolio at par value. This comprises of the Post Office, the AA and the Bank of Ireland’s branded consumer credit cards for a consideration of c.£530m to CCP Credit Master Lux S.à r.l. and CSCP III Master Lux S.à r.l. which are special purpose investment vehicles advised by affiliates of Centerbridge Partners Europe LLP and Jaja Finance Limited (“Jaja”).

In addition, the Group and Jaja have entered into a separate long-term agreement under which Jaja will become the issuer for the AA and Bank of Ireland’s consumer credit cards.

As at 31 December 2018, the UK consumer credit cards portfolio was c.£545m and, in 2018, this business contributed £35m of total income and had operating expenses of £36m. The sale of this portfolio is expected to generate a c.70bps improvement in the UK business RoTE and c.10bps towards the Group’s CET1 ratio.

The sale proceeds will be used for general corporate purposes.

The Bank will continue to service the credit card portfolio until the transfer to Jaja takes place in 2020. Customers can continue to use their credit cards as normal and will still have access to the same dedicated Customer Help & Support Service. Customers will be written to prior to the transfer of their credit card account to Jaja.

Bank of Ireland UK CEO, Des Crowley, said; “Jaja is an innovative company which shares our commitment to delivering outstanding customer service. We are proud to partner with them, and bring their next generation credit card to customers across the UK. Today’s announcement demonstrates the Bank’s continued progress in delivering against its strategic targets for growth and transformation to 2021, as set out at its Investor Day in June 2018”.

The sale excludes the Bank’s Northern Ireland commercial credit card portfolio. Credit cards issued in the Republic of Ireland are not impacted.