Bryan Wall: Won’t Somebody Please Think Of The Banks?


From top: Ross Maguire of New Beginnings; banking whistleblower Jonathan Sugarman; Bryan Wall

One of the most amazing articles in recent times came across my Twitter feed last week. The author, Ross Maguire, contended that banks are getting too much flack from the public, which itself has been whipped into an anti-bank frenzy by academics and activists.

He argued that this is a dangerous form of populism. This populism, in the author’s mind, is dangerous because it involves people exaggerating their problems and seeking out a scapegoat.

Any solutions they offer are “clichés” and therefore, one can surmise, not to be taken seriously by privileged men such as the author.

In the author’s mind banks do not deserve the scrutiny they receive from the wider public. This attention, he insists, “has now developed a whiff of populism”. But the author’s definition of populism is one associated with Donald Trump and hardcore Brexiteers.

And given this, he is trying to dismiss the concerns of ordinary people while at the same time attempting to perform a semantic and theoretical sleight of hand by making banks and their shareholders victims. In this equation, the victims have become the victimisers.

Populism has been twisted and corrupted by people like the author of the piece and the likes of Donald Trump. But populism has only ever meant one thing: An overriding concern with the needs of the common people.

This has always been seen as a threat because the idea of people having their rights respected, let alone granted, has scared establishment figures throughout history.

In fact, it precipitated a Trilateral Commission study in the 1970s which found the above notions of people having the temerity to demand their rights be respected so obscene that they called it a “crisis of democracy”.

In Maguire’s case the obscenity is that banks may have something to answer for and people are in fact rightly angry.

His only allusion to this is that banks might deserve this “to some extent”. For Maguire, protections for homeowners would be “profoundly negative” given the effects on the market. And besides, “Irish borrowers are already so well protected”.

Dare he mention the fact that last year thousands of people had their mortgages with Permanent TSB sold off to vulture fund Start Mortgages. In many cases the mortgages were performing but Permanent TSB wanted them off its books. Protected indeed.

But Maguire’s attitude, even though he isn’t a banker, seems emblematic of banking culture in general. Ethics and regulations become optional or in some cases a disadvantage.

Take the case of whistleblower Jonathan Sugarman. Having taken up a position as a risk manager for the Dublin-based but Italian-owned UniCredit Bank in May 2007, he quickly realised that the bank was regularly breaking Irish banking laws.

Irish legislation allows for a 1% breach of liquidity by banks. Sugarman discovered that UniCredit was in breach by up to 20% on daily basis. This meant that every day the bank was running billions of euros short.

As he related to an Oireachtas committee in 2017, Sugarman informed the Central Bank of the liquidity breaches. According to him, “A breach of 1% should have set alarm bells ringing” in the Central Bank. But with a breach of 20% he said, “I expected all hell to break lose”. Instead, nothing happened.

After hiring an outside IT company in order to get a second opinion, it reported to him that UniCredit was actually breaching liquidity by up to 40%. Sugarman’s figures, it appears, were conservative.

He resigned the next day and has been seeking justice since then. It appears no sanctions were ever placed on UniCredit for its liquidity breaches. Irish banks ran dry of liquidity the following year in 2008 which then gave us the bank guarantee. So not only was UniCredit in breach of liquidity regulations, everyone was.

I recently met Sugarman and he continues to be amazed at the lack of accountability in Irish banking circles. The inquiry into the collapse of the Irish banks was, he agrees, a distraction and farce, with the outcome predetermined.

This was seemingly confirmed at the time by a different whistleblower who claimed the Central Bank was redacting and in some cases withholding vital documents from the inquiry’s investigators. This story — and Sugarman’s — is far from over.

Meanwhile, Maguire has attempted to defend the indefensible by insisting that any anger the Irish public may feel because of the above actions of banks is irrational.

“Rage”, he says, “is the human emotion associated with populism. But rage is not intelligent and only intelligence solves real problems”. Therefore, populist notions of wanting banks to be held accountable for their actions is unintelligible. It stems from a place of rage and not of cold calculation.

But rage is justifiable and it in no way lessens the idea of populism; the idea that the concerns of average people are important. In Maguire’s world, banking should be left to the technocrats who know better. Any ill will thrown in their direction is misguided, misplaced, or simply irrational.

This contempt is elitism writ large. It’s the same contempt that caused the liquidity breaches in 2007 and 2008. And it’s the same contempt that’s going to give us another economic crash.

As Sugarman told me, nothing has changed since 2007. And the next crash, which is coming soon, won’t be pretty.

This is supported by former Central Bank governor Patrick Honohan. He has said that “deeper reforms” are needed in Irish banking. Furthermore, he pointed out that there is a:
long-standing culture of corporate entitlement by the banks operating in Ireland.

He also revealed that regulators are “deferential”, “lenient”, and showed a “tendency to passivity” towards banks.

Despite this not-so-new revelation, we still have to deal with unaccountable banks and bankers putting people’s homes and lives at risk. For them profit is never enough. It has to be an obscene profit that is endless and always increasing.

But to question this is unfair. It is to give in to populism. After all, we can’t have people being put above profits.

Bryan Wall is an independent journalist based in Cork. This is an election special. Bryan’s regular column appears here every Monday. Read more of Bryan’s work here and follow on Twitter:  @Bryan_Wall

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51 thoughts on “Bryan Wall: Won’t Somebody Please Think Of The Banks?

  1. Cian

    You complain about the definition of populism, and then regurgitate the same populist nonsense.

    “Dare he mention the fact that last year thousands of people had their mortgages with Permanent TSB sold off to vulture fund Start Mortgages. In many cases the mortgages were performing but Permanent TSB wanted them off its books. Protected indeed.”

    The first sentence is true.

    The second sentence is dangerous because it involves you exaggerating the problem. According to the link you provided *some* (not “many” as you say) of the loans were performing BUT were linked to a second loan which is “non-performing BTL or PDH in arrears'”. In other words people put their houses up as collateral. When the bank sells the bad loan, the performing one goes with it.
    Finally you say “Protection indeed”…. which is bizarre. The protection that applies to a mortgage holder is the same regardless of who owns the loan. All banks must adhere to the same set of standards. Nobody ever said that you are protected from the bank selling your mortgage. It looks to me like you are seeking out a scapegoat.

  2. phil

    Well it seems Ross Maguires web guys are crap , try hitting this URL

    and you will see

    Fatal error: Out of memory (allocated 18874368) (tried to allocate 12 bytes) in /home/wwwnewbeginning/public_html/wp-content/plugins/responsive-menu/vendor/twig/twig/lib/Twig/Lexer.php on line 234

    Im sure Ross would agree that it would be a ‘dangerous form of populism’ to get angry with the web developers or content hoster …

  3. Vanessa the Holy Face of Frilly Keane

    So I know this is sorta my thing
    But given the company this columist has been known to keep, and what they have had to say about me and my own practice,
    Not to mention everything else
    I’m going to leave this to Eoin, Cian, Owen C and others

    Only to say that anyone
    Even an Independent Journalist
    That uses PTSB as an example of anything in the retail finance and banking sector, particularly in long-term secured lending activity
    Past or present
    Is not as familiar with the industry as they think they are

    Likewise with the work, activities, specialist practice areas and commercial Interests of Mr Maguire SC

    1. Bodger

      ‘But given the company this columist has been known to keep.’

      What on earth are you talking about? Like The Stasi around here.

      1. Vanessa the Holy Face of Frilly Keane

        See below Bodger

        But to provide more clarity
        I am particularly mindful of comments that include
        Broadsheet Troll Dog, Psychopath, Anonymous Cowardly Troll

        On an article such as this, these would only serve to add to the widespread confusion and common misunderstanding around residential mortgages, and the transfer of loans, and those engaged in that sector. On all sides.

        The inevitable result is the keeping of concerned and possibly distressed home owners, and the general public misinformed, and flaying widely in choppy waters because that’s what they heard from someone on the internet

        As Cian put it earlier – populist nonsense
        And in my direct experience this actually inhibits proper dialogue and appropriate solutions being entered into everyday discourse

        That is why I posted what I did;
        To avoid any of the typical aggression that I have become accustomed to


        Ps: and b, I fully expected you to throw in here. Maybe Bodger and Bryan will understand now Why I posted what I did. If ye can’t find what ‘ b’ posted here last September/ October
        Gimme a shout – I’m sure I have screen shots somewhere

        1. Bryan Wall

          Wait, so I’m responsible for comments made by others? I’m not sure I follow.

          I’m not sure how that has to do with this.

          1. Owen C

            Bodger – Its our litigious investigative journalist friend, Bryan’s bigging up of her back in the day, and Frilly’s harsh treatment that has been received in the interim

          2. millie st murderlark

            Thanks Owen because I thought we were going to need the Rosetta Stone to get to the bottom of this one

    2. Owen C

      A few responses:

      1. “So not only was UniCredit in breach of liquidity regulations, everyone was”. Unicredit liquidity breaches were very specific to them and completely different to the problems faced by the domestic Irish banks. That’s kinda the problem – the Irish banks weren;t actually breaching liquidity regs, the regs simply weren’t up to scratch in those cases. So this is categorically wrong, even allowing for the Anglo/ILP rinky dink.
      2. “Populism has been twisted and corrupted by people like the author of the piece and the likes of Donald Trump.”. Or people who are the Irish versions of Donald Trump. You know, the people supported by the likes of the author of this article, and by this entire website for a decent chunk of 2018. Ahem.

  4. Joxer

    Why wasnt Sugarman listened to at the time he reported UniCredit? Is there some official record of what Central Bank did/thought of his report?

    1. GiggidyGoo

      An official record? You must be joking. There’s a €3bn broadband in the news the past year and no official records of meetings between the minister and McCourt.
      Official records are for small fry like us and Revenue

      1. Cian

        That letter suggests that the Central Bank investigated the matter and found no evidence that the bank was in breach (aside from the one day in question).

        The Central Bank also had an independent 3rd party investigate this – and this did not highlight any further breaches.

        So either Sugarman was wrong, or the Central Bank/the Independent 3rd party was wrong.

        1. Vanessa the Holy Face of Frilly Keane

          I haven’t seen any of those reports

          But what I can say is that Liquidity Ratios are calculated incorrectly on a regular basis
          Although it’s now usually picked up in Prudential Returns to the CB

          It’s not exactly the calc that’s the issue
          Nor is it the result of incompetence

          It’s coming up with the denominators that creates the problem
          Timing errors
          Unapplied charges or write offs or write backs
          Incorrect or out of date valuations
          Inconsistent treatments of particular transactions and balances

          Loads of different potholes there

          But thankfully
          For everyone’s sake
          Prudence is now back as an accounting principle

          1. Vanessa the Holy Face of Frilly Keane

            Also meant to add

            As someone who has a direct relationship with the Central Bank
            Via three separate Regulation Depts

            I can absolutely swear that the CB today is a very different institution to the one it was in Neary’s time

            So maybe everyone should focus on current structures and regs, rather than using historical standards to examine current Banking activities

            The Central Bank of Ireland is currently our most profitable State owned business

          2. Cian

            “The Central Bank of Ireland is currently our most profitable State owned business”

            can you expand this? Why is it profitable?

          3. Owen C

            Central Bank books bonkers profits on its holdings of the Anglo Irish/FRN bonds. It’s a circular transaction between CBI and the NTMA, so the profit is really the PV of lower borrowing costs for NTMA now vs what NTMA would have had to pay on the open market in 2014

          4. Vanessa the Holy Face of Frilly Keane

            Indeed Owen

            From Billy t’ Jack t’ Peter t’ Paul and back to Billy again

            Swap those names in and out with
            Top teir firms, members of the law library, Government Ministers, Membership of State Boards, Committees and Advisory what-have-yas, PLCs, Governing bodies and Semis, EU etcs
            Political Families/ Dynasties

            Basically why we are where we are
            What ridiculously paid Leadership and Management Gurus / former heads of …. would and do say
            The way things are done around here

  5. Sam

    Meanwhile thanks to the banks all that should of retired to enjoy their pension this year found that pension they should of got some 13 grand went to pay the debt caused by the banks

  6. The Old Boy

    Good grief, between Charger Salmons’ return in an unconvincing Nordic persona and all the more-than-usually personal exchanges above, this has been a most unpleasant day on Broadsheet.

    1. millie st murderlark


      By a very fortuitous turn of events, I happen to have missed the worst of it, but my word. What a truly hideous day if the comments I’ve seen are any indication.

      1. millie st murderlark

        You did. Very toxic day.

        Never have I been happier to be absent from an online spat.

  7. Vanessa the Holy Face of Frilly Keane

    Just so ye know that my post above that mentioned Bat Signal
    Was a reply to a recent arrival
    But unusually familiar
    Ye know what I mean – under a new hat

    That has been deleted

    They haven’t gone away
    all in my head sure

    Jaysus knows what has them all spooked today

    But hey
    Tis great weather outside
    Make sure ye get out in it

    1. b

      Vanessa, I genuinely think you’ve the wrong person or wrong end of the stick in whatever you are suggesting I posted in the past. In the interests in keeping these comments sane and civil, you should just come out with it.

      1. Vanessa the Holy Face of Frilly Keane

        I’m happy to pretend there are 2 small b logins
        Distinct and separate from the other

        However to give you some reasoning around my attitude
        Here’s a doxxer posted by ‘b’ with the green bean shaped avatar on the 14th Aug 2018 @9.31 pm

        Frilly aka the resident z- list accountant is on patrol, you’ll have to reinvent yourself like the rest of us
        This refers to the lie that I own and moderate BS

        Others go back into July of 2018

        I specifically went to a thread here now that I knew ‘b’ posted because I have a screenshot (late August btw)
        Kicking me about with ” A N Other ” groomed specialist around the time
        Doxxing and lies and bullying
        And it’s been deleted

        So maybe you followed my heads up from last week
        I dunno

        But I’ll believe there are two of ye
        And tis all accidental and in my head
        If it help
        I’d love us all to go back to this time last year
        Post repeal, heatwave,, bake off etc

        Funny how all that came to end
        Funnier still that people still insist tis all my fault

        And it still stinks and stings btw

        1. b

          well that is sort of an apology…a sorry, not sorry.

          there was another poster using b and I pointed it out at the time in another thread

          I do take exception to suggestions though. If I had an alter ego, why would I use the same login? I havent deleted any posts either, maybe the mods can confirm that.

    2. GiggidyGoo

      I’m confused.Any chance of a bit of clarity of what’s happened, to who, by who,?

      1. Bodger

        GiggyGoo, we posted a story about an anti-Pizzagte guy called Dr Pizza arrested for soliciting sex with minors. The Pizzagate meme was started by people like Dr Pizza to deflect.

        As usual, the tin foil started flying in the comments and I pushed back very hard, for once, because this has been going for two years and it is a serious subject.

        And then Bryan Wall wrote a column and Vanessa/Frilly accused him of something about the ‘company he keeps’.

        1. Vanessa the Holy Face of Frilly Keane

          I think you do Row
          But let’s leave it at that
          It’s being a cess pit here today
          The worst thing I saw here was neither directed at me nor on this thread
          But one thing the majority of original posters here can generally agree on
          Is that we all contribute more successfully when it’s funny, investigative, informative, gossipy, silly and wholesome

          I fully accept
          As I always did
          The undeniable rule we must all oblige
          Their gaff, Their rules

          There is an ill-wind about for sure
          And has been for the last week or so
          Yet it’s up to everyone, including me, and you, as to whether it gathers strength
          Or whether it loses interest and converts into a nasty fart

          Until then
          Let’s all line up behind one thing
          The fight for Rockall

  8. Janet, I ate my avatar

    I may have Wally moments
    but I only have one name
    I’m not a malicious agressif poo stirer either

    but otherwise yeah great point….

Comments are closed.

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