Bank of Ireland investors holding Perpetual Subordinated Bonds (PSBs) have been told the bank has postponed plans to exchange their investments for shares worth 40 per cent of the value.

Campaigning investor groups had been calling for the deal to be stopped with many pensioners rightly noting that proposals to exchange their bonds for new shares were completely biased towards professional investors and, therefore, unfair.

PSB holders not wishing to hold the new shares could have opted for a cash offer to the value of just 20 per cent of the value of their PSBs.

On Friday, the bank had confirmed that only 12 per cent of bondholders had accepted the offer of either a cash payout or proposals for the heavily discounted debt-for-equity swap.

In a statement to the market, the bank said it would be instigating a new offer to PSB holders at a later date.

It said, ‘In doing so the bank will seek to address the unique difficulties that have been highlighted to date with regard to participation in the terminated offers by the holders of the £75 million 13.375 PSBs.’

Many account holders with Bristol & West have held PSBs since Permanent Interest Bearing Shares (PIBS) were issued to them in 1991, which then converted into PSBs when the Bank of Ireland purchased the building society in 1997.

As part of Bank of Ireland’s capital management programme, it plans to issue a rights issue underwritten by the Irish government to raise £3.6 billion (€4.2 billion).