Anglo inquiry delayed by one week

THE Financial Regulatory Authority has been given an extra week to prepare its explanation to the Oireachtas Committee on Economic and Regulatory Affairs.

The regulator, Patrick Neary, and the chairman of the regulatory board, Jim Farrell, had agreed to appear before an Oireachtas committee tomorrow.

However, chairman of the committee Michael Moynihan said this has been delayed and they will instead attend on January 13.

The scope of the committee’s questioning has been expanded beyond seeking an explanation of the office’s handling of the Anglo Irish Bank pre-Christmas scandal. The pair will be asked to account for Irish banks’ reluctance to pass on interest rate cuts to mortgage holders and the authority’s policing of other banks guaranteed by the Government.

Yesterday a statement for the committee said the authority would have until Tuesday next.

In December the committee called in representatives from the regulators’ office after two directors and the chief executive of Anglo Irish Bank resigned.

This was because €87 million worth of loans to ex-chairman Sean FitzPatrick had been hidden from shareholders.

It also emerged details on the loans had been discovered by the authority much earlier in the year, but this information was not passed on to the Department of Finance or the Government.

This has put Mr Neary under pressure to step down and the board of the authority is conducting an internal inquiry to find out who knew what and when.

The resignations and subsequent commitment by the Government to takeover 70% of Anglo Irish for €1.5 billion failed to prevent a sprint away from the bank by investors. Despite rising from a December low of €0.15, shares at Anglo were being sold at €0.19 at the opening of yesterday’s trading. They rose marginally throughout the day.

This was after it emerged Anglo will proceed with its promised inflation-based pay rises to lower ranking staff.

However, the bank defended this and said pay was frozen to all senior and middle management personnel.

Yesterday the Department of Finance refused to comment on the pay increases at the troubled bank.

Neither did it confirm if Irish Life and Permanent was about to fall within the bailout programme after its share price rose yesterday.