Expert to advise on questioning bank chiefs

AN Oireachtas committee will hire a banking expert to advise it on how best to grill the bosses of the country’s senior banks about their role in the financial crisis.

It comes after members of the Committee on Finance expressed dissatisfaction with the answers they got from lower-ranked bank officials at a previous meeting.

The committee hopes that the independent banking expert will be able to guide them in their questioning, so that they get “specific” rather than “general” answers.

The committee is currently in the process of recruiting the consultant, and hopes to appoint somebody within the next couple of weeks, chairman Michael Ahern, FF, said last night.

“If we want to get good value [from the meeting], it is necessary to have an expert in the field so that we are not going down the wrong road,” he said.

But the time involved in recruiting the consultant, plus the fact that the committee has other business on its agenda, means the much-awaited meeting with the bank bosses will now not take place until next year, Mr Ahern said.

It had been expected that the bosses would be summoned this year, because of both the scale of the crisis and committee members’ unhappiness with the outcome of the previous meeting.

That meeting took place in July, and saw senior executives from AIB, Bank of Ireland, Permanent TSB and Anglo Irish Bank appearing before the committee to discuss lending policy and money supply.

Although they admitted that liquidity problems were increasing, they stressed that their banks were in good health and remained “open for business” in terms of lending.

But a number of committee members were dubious, and demanded that the overall bosses of the banks, the group chief executives, be summoned instead.

Fine Gael TD Seán Barrett was one of the committee members who expressed his dissatisfaction with the meeting at the time, saying of the bankers.

“They went through the exercise, stating there was no problem and that everything was fine. In the meantime, bank shares have been going down, there are concerns and rumours, there are disasters in the US and nobody knows when this will end,” said Mr Barrett.

Just two months later, the Government was forced to launch a massive bailout of the banks.

The senior executives who appeared before the committee in July were Donal Forde, managing director of AIB; Richie Boucher, chief executive of Irish retail financial services for Bank of Ireland; David Guinane, chief executive of Permanent TSB; and Willie McAteer, executive director of Anglo Irish Bank.

The group chief executives which the committee now wants to hear from are Eugene Sheehy (AIB), Brian Goggin (Bank of Ireland), Denis Casey (Irish Life and Permanent) and David Drumm (Anglo Irish Bank).