Companies

Explainer: Why AIB and PTSB are moving to pay €2.5m to buy out ‘trapped’ pre-crash shareholders

Both banks are looking to pay their smaller investors a 5 per cent premium to incentivise their exit, we explain why and what it means for small investors

Ahead of their annual general meetings the banks have tabled proposals for an odd-lot offer, where they would buy back shares at a 5 per cent premium to the market rate. Picture: Francis Dean

Companies often go hunting for more investors so the idea of paying to get rid of them seems counter-intuitive, but that is the road AIB and PTSB are going down.

Ahead of their annual general meetings the banks have tabled proposals to allow them to launch odd-lot offers, where they would buy back shares at a 5 per cent premium to the market rate and then cancel them.

At AIB investors with 20 shares or under qualify, while at PTSB those with 100 or under could avail.