BoI staff told of Anglo insolvency ‘should tell gardaí’

ANYONE in Bank of Ireland who was told that Anglo Irish Bank was insolvent prior to the bank guarantee scheme being announced in September 2008 should report the issue to the gardaí, Brian Lenihan has said.

The Finance Minister was reacting to a claim in an RTÉ documentary that Bank of Ireland was approached by Anglo senior management early on September 29, 2008, because the latter was in massive trouble.

The documentary reported that Anglo officials requested Bank of Ireland take over the troubled institution because it was insolvent. According to the documentary, Bank of Ireland refused the request.

Earlier this week, Taoiseach Brian Cowen insisted that nobody had told him on September 29 that Anglo was insolvent.

Mr Lenihan echoed those comments last night, and said if the report was correct, it was a serious matter.

“If such a comment was made to an executive of the Bank of Ireland, they should immediately report this matter to the Garda Síochána,” he said. “Because at all stages of course, it was represented to the regulatory system and the Central Bank that this was a solvent bank. And clearly, there would have been statutory declarations and other documentation confirming that fact. And accounts, indeed, were presented by the bank subsequently to that, and signed off by the directors confirming that the bank was solvent. So if there is someone in Bank of Ireland to whom this statement was made, it should be of course brought to the attention of the Garda Síochána. It certainly wasn’t brought to my attention.”

The bank guarantee was put in place on the night of September 29 and Anglo was included in it. If the bank actually was insolvent at the time, and had that fact been known, a different decision may have been made.

Meanwhile, Mr Lenihan conceded yesterday that the country remains in a “fragile” state and that international confidence in Ireland has to be restored urgently.

Mr Lenihan was speaking shortly after announcing that Anglo would be split into two entities.

The announcement was made in the hope of demonstrating to the markets that the Government was moving towards resolving the Anglo problem.

Ireland’s borrowing costs have soared recently, with analysts attributing the rise to the fact that the markets fear the Anglo bailout could cripple the country.

“Things are very serious,” Mr Lenihan admitted. “It is fragile, and it has been fragile in recent weeks. What the Government has to do is take a series of decisions which build up confidence in the markets in the capacity of the banking system and the economy and the fiscal system.”

He insisted there had been “unity” within Cabinet over the new plan for Anglo, even though the Greens had been pushing for a wind-down within 10 years. The Greens last night issued a statement welcoming the plan, saying it provided greater certainty about the future of the bank.


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