No move on NIB’s future in short term

THE future of National Irish Bank (NIB) will only be determined as part of on ongoing review and no decision is expected in the short term, the bank’s Australian parent said yesterday.

National Australia Bank (NAB) said it was continuing to review its European operations, which also include Northern Ireland’s Northern Bank and British banks Yorkshire and Clydesdale, amid speculation that a sale of some or all of the banks was being considered.

NAB directors yesterday began a two-day meeting that was expected to include a presentation from Ross Pinney, the bank’s European head.

Analysts said the meeting would deal with NAB’s future strategy as well as addressing concerns over declining market share in Australia and a tumbling share price.

The group has been out of favour with investors since news emerged earlier this year that the bank had suffered a €210 million loss arising from unauthorised foreign exchange trading in its London office.

The episode resulted in a boardroom clear-out that included the departure of then chief executive Frank Cicutto.

Australian media reports suggested NIB and Northern would be put up for sale in a combined deal worth €1.2 billion. Goodbody stockbrokers said a shortlist of possible buyers for the banks would include British giant HBOS, Ulster Bank parent Royal Bank of Scotland and Bank of Ireland.

Closer to home, meanwhile, the 19 former NIB executives named in last week’s High Court report on malpractice in the bank face the prospect of being barred from holding directorships of Irish companies within weeks. The Office of the Director of Corporate Enforcement (ODCE) is expected to move to have the individuals struck off under companies legislation that cracks down on improper conduct.

The ODCE and the Revenue Commissioners will also hold talks with the Director of Public Prosecutions to establish whether criminal proceedings should be put in train against those named in the report.

Cases may be prepared to establish whether there were breaches of tax or company law.

New companies legislation lists a range of offences, such as fraudulent trading and failure to keep proper records, which are relevant to company directors and officers.