Bank of Ireland cuts leveraged finance staff by a third

Bank of Ireland is cutting front-office jobs in its UK leveraged finance team as part of its plans to broaden the scope of its lending business to include underwriting larger buyouts domestically and throughout Europe.

The move, which comes after a year when UK leveraged buyout volumes hit record highs, is a new and more aggressive strategy for the bank after six years of focusing purely on financing smaller, mid-market acquisitions.

The bank said it is cutting five from its team of 14 leveraged finance bankers in London, although it added it plans to make as many senior appointments to make up the shortfall.

The team, which specialises in structuring senior and mezzanine facilities, sits within the acquisition finance division that numbers 85 in total across its offices in Dublin, London, Paris and Connecticut in the US.

The introduction of the new strategy comes less than a year after Bank of Ireland appointed Peter Mullen, formerly director of leveraged loan sales and syndication at Société Générale in London, to lead its loan syndication business.

Tom Hayes, chief executive of Bank of Ireland's corporate banking business, said Mullen's hire last year was the first step towards refocusing its leveraged finance business to target "mid-market financial sponsor coverage on a pan-European basis".

Mid-market leveraged buyouts have been booming in recent years as private equity sponsors target smaller companies in acquisitions worth between €50m ($65m) and €300m.

UK-listed buyout firm 3i is one of the most active funds participating in the European mid-market, which is now beginning to attract the attention of top-tier investment banks.

Credit Suisse, one of the global leaders in leveraged finance, is one of a number of firms that have decided to grow their mid-market lending business.

Last September, Bank of Ireland along with Barclays Capital led the underwriting of the debt backing Limburg Media Group's acquisition by Mecom Group, the specialist media sector investor run by David Montgomery, former chief executive of the Mirror Group.

The €138m LMG financing package comprised €109m of senior debt and €29m of mezzanine debt.