Bank directors - Why didn’t they block €1.5m deal?

IT’S probably expecting too much of the banks’ public interest directors to be thorns in the side of the culture that blithely stumped up the €1.5 million pension top-up for Bank of Ireland boss Richie Boucher.

It’s probably expecting too much to imagine that they might react as any rational member of the public — otherwise known as the taxpayer who saved the banks — when faced with rapacious greed dressed up as “compensation” and say “no” loudly and publicly. What a cheer they would get.

This is especially so when Taoiseach Brian Cowen can declare, with a straight face, that no one told him that things were, when he was finance minister, a bit off colour at Irish Nationwide. If Mr Cowen imagines that this pathetic, mental-reservation defence is anything other than offensive, then he’s put his foot in it one more time.

The Bank of Ireland’s state-appointed non-executive directors are former secretary-general of the Department of Finance and former board member of the Central Bank and Financial Services Authority of Ireland Tom Considine, and former Fianna Fáil minister Joe Walsh.

Neither could be described as anything other than a top-tier establishment figure. In the vernacular, they are two of the lads. In long careers neither did anything that suggested they might be comfortable challenging the Bank of Ireland “court” on anything as trifling as a €1.5m dig-out for another one of the lads.

Each received basic fees of €63,000 last year, while membership of various committees brought Mr Considine’s fees up to €102,375 and Mr Walsh’s to €78,750.

This level of “compensation” is up to six times more than that paid directors of state bodies.

How much better off we all would have been — Mr Boucher and the Bank of Ireland too — if we had had a kind of no-nonsense Elderfield-style intervention when the pension payment became an issue last year.

We are foolish too to accept that Mr Boucher’s “I have decided to waive my option to retire on pension at age 55” is the kind of U-turn that was needed. Its vagueness, with prairie-scale wriggle room, defines the kind of contractual looseness Judge Judy dismisses with a regal flick of her wrist and a considerable degree of contempt for those who sought her court’s protection.

Mr Boucher may have created the impression that he was doing something to reflect the mood of the day, and he may well be, but a direct “the €1.5m has been removed from the Bank of Ireland pension fund and returned to where it came from” would have been much more convincing.

Public confidence in politics and banking is at a dangerously low ebb and, unless public interest directors are seen to be proactive and, if needs be, aggressively intrusive, they serve no purpose other than to sustain the practices that threaten our independence.

We were told yesterday that we had the biggest government deficit in the EU last year — 14.3% of GDP — higher than Greece at 13.6% and Britain at 11.5%. Our public debt stood at 64% of GDP.

These are catastrophic figures and are a threat to each and every one of us. That is why we need our public interest directors at the banks to earn their corn.