Six years ago, CHL was bought for £12.5 milion by Irish Permanent. At the time, the acquisition was seen as a vehicle through which the Irish mortgage lender would expand into the British market. But, Irish Permanent’s subsequent merger with Irish Life has led to a change of focus.
Now the group is concentrating on lending and saving in its domestic market. It has pulled out of Hungary, sold off two of its American units, and is now about to dispose of what it calls a ‘non-core’ UK business, which specialises in the buy-to-let mortgage market and has a loan book of £1.6 billion.
The CHL sale is expected to realise around £110 million, which is some five times the price Irish Permanant paid and would represent a very good return after just six years.
According to Irish Life & Permanent, it has received a number of expressions of interest from potential buyers.
The London lender has been a successful investment for its Irish parent cmpany, reporting pre-tax profits last year of £11.6 million. But, according to Irish Life & Permanent sources, the buy -to-let market has become increasingly competitive, with a number of new entrants attracted by the prospect of larger profits than on other lending products.
