Sale challenges ‘politically motivated’

The former CEO of Anglo Irish Bank has claimed that there were challenges to asset sales by the bank that were "politically motivated" just before it was liquidated.

Sale challenges ‘politically motivated’

Mike Aynsley claimed a Department of Finance official had alleged that Finance Minister Michael Noonan would back the sale of an asset for €100m less than the top offer.

Mr Aynsley said he was “shocked” when he received this information from one of the bank’s directors in January 2013.

That bank official had told Mr Aynsley in a detailed email how he had met a department official about the sale of a major asset belonging to the bank.

During a conversation about the asset, the department official indicated Mr Noonan had a particular preference for the sale.

Iin his statement, Mr Aynsley said: “The bank executive then moved the conversation to the possible sale of another major business asset and asked the DoF official whether he would be in agreement with a certain price in the sale process from the same Irish business person or his company, or alternatively a €100m less from another party. The response from the DoF official was that the lower price would be preferable and that he believed the minister for finance would be supportive of that position.”

Mr Aynsley went on to describe how the department in general had wanted the disposal of assets “accelerated”.

He summed up the situation in his statement, saying: “I formed the view that much of the comment/challenge from the DoF increasingly became politically motivated.”

Inquiry committee member Michael McGrath said this was an “extraordinary allegation”. Mr McGrath has now asked the banking inquiry to send on details about the alleged incidents to a separate commission of inquiry which is examining deals done by IBRC, which took over Anglo, and was liquidated in February 2013.

Mr Aynsley also went on to say that the sale of the bank’s US portfolio was done under “ministerial instruction”.

Former Anglo chairman Alan Dukes said that there were occasional incidents of pressure from the department about selling assets.

“There was from time to time a suggestion that we should do it differently.”

Mr Dukes, who initially was a public interest director on Anglo, described how Ireland did “not have the tools” to deal with the banking crisis when it hit.

But he also said he would not have done anything different than the Government did in guaranteeing the banks in September 2008.

Nonetheless, apart from the Central Bank, authorities here did not have the skills to micromanage banks and should not have done so in any case, he told the committee.

He described how, when Anglo went into wind-down, that the bank was required to act “at arm’s length” from the Government.

The Department of Finance did not take this on board, he suggested.

Mr Dukes described how at one stage officials in the department wanted the bank to become part of the Department of Finance.

He also said: “In sum, it seemed to me that the department, having conceived the perfectly valid strategy of nationalising Anglo, having then concluded that a wind-down was appropriate and having handled the very difficult issues of recapitalisation and continuing support to very positive effect, decided not to have any trust in the institution it had set up. In the process, it wasted a great deal of time and has now created an unnecessary political controversy.”

Mr Aynsley said he had never considered “packing his bags” when he was CEO of Anglo even though it was a “toxic” bank. However, he also said that he was “not sure lessons have been learned” about separating policy between banking and the State.

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