Maple 10 lender Gannon approached by Anglo

A building developer who was one of the so-called Maple 10 lenders has told the trial of three former Anglo Irish Bank executives that the bank approached him and said an opportunity had come up.

In July 2008, Gerard Gannon drew down a €45m loan and bought 10 million shares in the bank on the basis that he would only be personally liable for 25% of the loan. He did not sell any and the shares became worthless when the bank was later nationalised.

Mr Gannon was giving evidence at the trial of Sean FitzPatrick, Willie McAteer, and Pat Whelan, who pleaded not guilty to all charges at Dublin Circuit Criminal Court.

Mr Gannon told the jury in July 2008, his personal fortune was approaching €1bn. He said that, in early to mid-July, “Pat Whelan told me an opportunity had come up and would I be interested in meeting David Drumm [then CEO of the bank]”.

He said he met the men and, after five minutes of “chit chat”, Mr Drumm asked him if he would be interested in buying shares.

“They said it was an opportunity because I was a good customer of the bank. It wasn’t a very long meeting, about 20 minutes.”

He said there was no mention of third parties and the €45m would come with a personal recourse of 25%. “If anything happened, I was to pay back 25%… I agreed there and then.”

Mr Gannon told Brendan Grehan, defending Mr Whelan: “I always found all people who worked in Anglo to be honest and truthful, the same as I like to think of myself.”

A second member of the Maple 10, Gerard Maguire, told the court he was in Nice, France, on July 10 when he spoke to Pat Whelan on the telephone. He said Mr Whelan told him the bank’s shares were coming under pressure.

Two days later, Mr Whelan and Mr Drumm flew to Nice where the three met.

“I believed others were investing as well and that this investment would put a stop to this run on bank shares and would bring stability and confidence which is what in fact happened immediately after.”

By the time the bank was nationalised, Mr Maguire said he held around 8 million shares.

In other evidence, the bank’s head of risk in Ireland in 2008, Niall Tuite, said on Christmas Eve that year, he confronted Mr Whelan after he learned the conditions on the Maple 10 loans had been changed, allegedly without the approval of the board.

He said he had indicated his dissatisfaction that to his knowledge, this change had not met credit approval. “He indicated that he would take responsibility for elevating the matter at a meeting between him and the then executive chairman of the bank, Donal O’Connor.”

Mr Tuite said that, a short time later, Mr Whelan “put his head into my office and said he had spoken to Donal and that the matter was in hand… His exact words were: ‘You don’t need to worry about it.’ ”