A GROUP of five international financial investors were given the green light yesterday by Bank of Ireland shareholders to acquire a 34.96 per cent stake in the company for €1.123 billion.

Shareholders comprehensively backed a resolution that allows Fairfax Financial Holdings, WL Ross, Capital Research and Management Company, Fidelity, and Kennedy Wilson to purchase 10.5 billion shares between them from the National Pension Reserve Fund, which is holding the stock on behalf of the State, as per an agreement struck in July.

This will result in the Government’s holding being reduced from 42.1 per cent to 15.1 per cent and keeps Bank of Ireland outside majority State ownership.

The five international investors already held an aggregate 9.8 per cent stake in Bank of Ireland.

In order to increase their holding to 34.96 per cent, they required a waiver from the Irish Takeover Panel as they were considered to be connected or so-called “concert” parties. Normally, under takeover rules, any person or concert party buying 30 per cent or more of a listed company is obliged to make an offer for all of the shares in the business.

This can be waived if a “whitewash” resolution is passed by independent shareholders.

Bank of Ireland yesterday received this permission at an extraordinary general court (meeting) in UCD, with 99.56 per cent of voting shareholders approving the resolution.

The State and the international group of investors were precluded from voting as they were involved in the transaction.

Had it not been passed, the international investors would have been limited to owning an aggregate 29.5 per cent, with the State holding 20.5 per cent.

The share deal has no effect on the combined holdings of other shareholders, who will continue to own 50 per cent of the bank.

The transaction now requires certain regulatory approvals before taking effect later this month or in early October.

The meeting attracted only about 40 shareholders for the early start in UCD’s O’Reilly Hall.

One quoted Roman politician and philosopher Cicero in asking “Who benefits?” Governor (chairman) Pat Molloy replied that the international investors were of a “high quality” and had a “long-term focus” in regard to their Bank of Ireland shareholding.

“We genuinely believe this will be for the benefit of shareholders as a whole,” Mr Molloy added.

John Flynn, a shareholder from Cork, congratulated bank chief executive Richie Boucher on his “masterstroke” in securing the investment. This led to applause from some of the shareholders.

Neil Duggan asked if the bank had the capacity to meet its obligation to provide €3 billion a year in funding for the SME sector, and other funds for venture capital and clean energy projects.

Mr Boucher said its level of deposits had “stabilised” and the requisite funding was available.