Some 2,000 British pensioners set to lose bonds worth a total of £46m may revive legal action against the bank that issued them.
The Irish finance minister Michael Noonan announced last Wednesday that bondholders had a week to respond to a plan that would see the bonds wiped out as part of a €4.2bn (£3.6bn) capital raising for the Bank of Ireland (BoI). The deadline was 5:30pm last night.
The pensioners hold permanent interest bearing shares (pibs), which payout 13.375% on face value every year. They were issued by the Bristol & West building society, which was taken over by the BoI in 1997.
But a campaign organised by fixed income expert Mark Taber has called on the pensioners to complain to Noonan about his plans, writes the Independent.
If Noonan pushes through the cancellation of the pibs, the campaign has asked lawyer Brown Rudnick to challenge either the government in the Irish courts or sue the BoI in the UK.
The BoI already withdrew one attempt to take back the shares for as little as 1p for every £1,000 earlier this year. This followed the threat of legal action by Albert Kempster, a 73-year-old pensioner who relies on the pibs for financial survival.
Taber said: "The focus at the moment is to persuade them not do this, but if the worst happens we will be looking at legal action. Most of the holders of these bonds are very elderly and wouldn't necessarily be aware that this is even going on."
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