Tag Archives: IBRC

CDXOGuNVIAEBH-O

Former IBRC chairman Alan Dukes defends his handling of the Siteserv transaction this afternoon at his solicitor’s office in Dublin.

Pic via Vinny Broderick

Earlier: It Wasn’t Me

      

Indefatigable North Kildare TD Catherine Murphy discusses the response received to a freedom of information request to the Department of Finance into the circumstances surrounding IBRC’s sale of Siteserv to Denis O’Brien owned Millington.

Just a little shady.

Ms Murphy TD sez:

“While the responses are heavily redacted, there are some key passages visible and they leave the reader in no doubt that there were serious problems in the relationship that existed between the IBRC – formerly Anglo, and the Department of Finance. Indeed at one point, the memo states that “…events over the past few months have led me to question the effectiveness of the management team in IBRC…I am concerned that the reputation of the IBRC and by extension the State has been damaged as a result of these events.”

Related:

Siteserv And The Bank That Liked To Say Yes

The Best Deal For The State

Siteserv For Sore Eyes

Sierra Where Would You get It?

Thicker Than Uisce: The Irish Water And Siteserv Timeline

Contains Impurities

Meanwhile…

Meanwhile…

denis-O-brien111-539x2870008ce60-642From top: Denis O’Brien: Catherine Murphy TD

You may recall how Catherine Murphy, Independent TD for North Kildare, has been asking questions of Finance Minister Michael Noonan in the Dáil about IBRC’s sale of Siteserv to Denis O’Brien.

Mr O’Brien bought it for €45.4million cash while Siteserv owed Anglo €150million.

The sale involved IBRC writing off €100million of Siteserv’s debt with €5million distributed to Siteserv’s shareholders.

After the sale of Siteserv to Mr O’Brien, GMC Sierra won a State contract to install water meters. GMC Sierra is comprised of GMC Utilities Group and Sierra Support Services Group. Sierra is a subsidiary of Siteserv.

It was previously reported that Australian hedge fund Anchorage Capital offered a higher price – €52million – but that ‘elements of the offer were considered less attractive then the O’Brien bid’.

And that French company Altrad claimed it was denied the opportunity to make an offer for Siteserv – saying it had been prepared to offer €60million – but that it was ‘effectively denied the opportunity because its representative was told the Irish group was not for sale’.

Last December, Ms Murphy raised her concerns about GMC Sierra’s water meter contract, in the Dáil, asking how could GMC Sierra be awarded a contract [by former Environment Minister Phil Hogan] for water meters even though it didn’t legally come into existence until July 15, 2013, 15 days after the closing date for bids.

She also asked Finance Minister Michael Noonan if he was satisfied that the IBRC acted in the best interests of the State when it sold Siteserv to Denis O’Brien/Millington.

In his reply, Mr Noonan stated that the IBRC acted “at an arm’s length to the State” and that “commercial decisions in relation to IBRC were solely a decision for the bank.”

In another question, Ms Murphy asked Minister Noonan to furnish her with the so-called Relationship Framework and Operational Protocol which oversaw the interactions between the Finance Minister and the former management and board [headed by Alan Dukes, former Fine Gael leader] of IBRC before it was liquidated.

Ms Murphy asked Mr Noonan to indicate to her the precise financial thresholds under the framework which would have “triggered mandatory consultation in advance of a transaction and/or disposal”.

In a reply on February 26 last, Minister Noonan confirmed to Ms Murphy that the bank would consult with the minister in relation to “any transaction which resulted in an adverse impact on total regulatory capital of the bank of greater than €100million would require interaction between the minister and the IBRC”.

Further to this, Ms Murphy then asked, if that was the protocol, why wasn’t Minister Noonan involved in discussions with IBRC, regarding the Siteserv sale.

In a reply, Minister Noonan stated that the protocol only came into effect on March 29, 2012 – 14 days after the Siteserv sale was completed.

Yesterday, Ms Murphy received three more answers from Minister Noonan in relation to records kept of meetings between Minister Noonan and IBRC in respect of the Siteserv sale; if IBRC extended a €10million credit facility to Siteserv between 2010 and its sale in 2012; and about IBRC’s reported rejection of a higher offer for Siteserv.

In his responses, Minister Noonan said the file notes, minutes and other records regarding his meetings with IBRC are currently the subject of Freedom of Information requests and will be released in due course.

As for the €10million credit facility, he said it wouldn’t have been typical for decisions around credit facilities to be disclosed or discussed with Department of Finance officials.

And, as for the higher offer for Siteserv, he said a company which made a higher bid made representations to the Department of Finance, prompting officials from the department to meet with IBRC. At this point, IBRC chairman – and former Fine Gael leader – Alan Dukes reassured the Department of Finance officials that the transaction was the best result for the State.

Minister Noonan also said minutes and records pertaining to these meetings are subject to Freedom of Information requests and will be made available upon their release.

However, here is a more detailed account of Ms Murphy’s questions and answers…

In her first question, Ms Murphy asked if records were kept of any meetings Minister Noonan or his officials held with IBRC in respect of the Siteserv sale; what questions he raised in respect of payments to the directors of Siteserv, in light of the debt that was written off; what questions he raised in respect of the number of tenders considered; why Millington’s bid was more deemed to be more advantageous to the State and the questions he raised in respect of this who were involved in the tender process.

In response, Minister Noonan said:

“As way of background on the transaction referred to in the question, following a meeting between officials from my Department and senior management of IBRC held on 31 May 2012 it was agreed that my Department would review this transaction to better understand the decisions taken by IBRC. This review took place, by way of a meeting between officials from my Department and senior management of IBRC, on 11 June 2012. Following this review, a further meeting was held on 25 July 2012, which I attended along with officials from my Department and senior management from IBRC. At this meeting, the transaction referred to in the question was discussed further, along with a number of other topics. A further meeting between the former Secretary General of the Department of Finance, John Moran, and the then CEO of IBRC took place in August 2012 at which this matter was further discussed.”

“The file notes, minutes and other records regarding these meetings are currently the subject of Freedom of Information requests and will be released in due course as part of these Freedom of Information requests should officials in my Department consider their full release to be appropriate. The Deciding Officer will make the materials released under these Freedom of Information requests available to you upon their release.”

“Until those decisions are made by the Deciding Officer, I can confirm that at the meeting which I attended on 25 July 2012, it was put to senior management of IBRC that officials in my Department had concerns with a number of decisions taken by IBRC in relation to the sale of the company referred to in the question including the decision to allow the sale process to be led by advisors of the company referred to in the question, the decision to exclude trade buyers, the timing of exclusivity and the payment to shareholders. Senior management of IBRC confirmed to me at this meeting that the transaction involving the company referred to in the question was thoroughly assessed by the Board of IBRC prior to them approving it and that the transaction was managed in the best manner possible to achieve the best result for the State.”

Secondly, Ms Murphy asked Minister Noonan if IBRC extended a €10million credit facility to Siteserv between 2010 and its sale in 2012; if he’d confirm that all due diligence procedures were followed in advance of the forwarding of this line of credit; and if the €10 million or outstanding portion thereof was specifically recovered through the sale of Siteserv or if the money was written down entirely.

In response, Minister Noonan said:

“In relation to the Deputy’s query on a €10 million credit facility extended to the company referred to in the question between 2010 and the sale of the company in 2012, I am advised that it would not have been typical for decisions around credit facilities to be disclosed or discussed with Department of Finance officials unless required under the Relationship Framework which governed interactions between the Bank and the Department of Finance as these activities typically would have been within the ordinary course of business for the Bank.”

“Officials in my Department have also contacted the Special Liquidators but they are unable to comment on individual cases as the information requested is confidential and it would not be appropriate for them to release such information. This being the case, I am unable to comment further on this matter.”

Finally, Ms Murphy asked Minister Noonan, if he’d confirm the media reports that IBRC had turned down a higher offer for Siteserv because one element of that proposal included a mandatory eight-week due diligence exercise.

She also asked if Minister Noonan was aware that if IBRC had chosen this reported bid, the new framework agreement would have been in place once the said eight-week period had expired. She then asked if he felt the sale of Siteserv was rushed and, if so, why.

In his response, Minister Noonan said:

“As part of parliamentary question 97 which was answered on 12 March 2015, the Deputy is aware of the process which was undertaken to introduce a revised Relationship Framework for IBRC and the reasons behind this.”

“In relation to the sale of the company referred to in the question, it was after representations made by an unsuccessful bidder in the process and subsequent meetings between that party and officials in my Department that my officials met with IBRC and undertook a review of this transaction. Following this review, my officials were made aware that the transaction involving the sale of the company referred to in the question was run by the company referred to in the question along with its advisors. This review raised concerns with the quality of some of the decisions taken in respect of this transaction, including, among others, that a higher bid for the company referred to in the question was received after entering into an exclusivity agreement with the ultimate winning bidder.”

“In light of concerns stemming from the review of the transaction by officials in my Department, I subsequently met with IBRC’s Chairman [Alan Dukes] and CEO to discuss this transaction. The Chairman and CEO confirmed to me that the transaction process and its terms had been thoroughly assessed by the IBRC Board and that the transaction was managed in the best manner possible to achieve the best result for the State.”

“The file notes, minutes and other records regarding the review of this transaction by my officials are currently the subject of Freedom of Information requests and will be released in due course as part of these Freedom of Information requests should the Deciding Officer consider their full release to be appropriate. The Deciding Officer will make the materials released under these Freedom of Information requests available to you upon their release.”

You Want Transparency?

Denis O’Brien, Fine Gael And The Water Meter Deal

‘I’m Getting Fed Up Of The Constant Questioning From Catherine Murphy’

Thanks Catherine Murphy

indo

Last Saturday’s Irish Independent reported that the former Anglo Irish Bank compiled a list of ‘politically-exposed persons’ (PEP) borrowers, which included certain rugby players, RTÉ stars, musicians, judges and some senior legal professionals, before it was liquidated last February.

The paper reported that the list was presented to the board of IBRC every quarter after it was nationalised in 2009 and that some of the high-profile borrowers’ details were provided by the IBRC to the State under a dedicated ‘Relationship Framework’ document, regulating dealings between the Finance Minister and the bank, after it was taken into State ownership.

At the time IBRC was liquidated, many of these loans were performing, others were impaired while other debtors couldn’t agree on a repayment strategy.

The newspaper didn’t reveal any names and, in its editorial said: “The identity of the PEPs was and remains confidential.”

But yesterday, the paper reported further on the list, saying six Catholic religious orders were placed on the PEP list, as well as a retired senior judge, an RTÉ star, an insolvency expert, a bestselling novelist, a member of the Seanad, lawyers, journalists, some of the country’s leading pension funds, a prominent businessman (*cough*) and a property syndicate, involving a number of “law library luminaries”

The Sisters of the Infant Jesus were on the PEP list and ‘suffered in the crash’, while the Diocese of Ossory escaped without any losses.

Meanwhile, this morning, the Irish Times reports former chairman of Anglo Irish Bank Alan Dukes saying:

“The relationship framework between Anglo/IBRC and the Minister for Finance provided for notification to the Minister of matters of potential public interest. Very few such cases actually arose. In no case was there any discussion of preferential treatment of any kind… “IBRC created the lists of politically exposed or high-profile persons to ensure there could be no suggestion that any credit decision in relation to somebody well-known or influential had been granted preferentially.”

Hmmm.

No Special Deals For Listed Anglo Borrowers Says Alan Duke Tom Lyons, Irish Times)

Religous Orders On Politically Exposed Anglo List (Irish Independent)

RTE stars, judges and rugby elite who owe Anglo millions (Irish Independent)

 

ANglo

anglo2

Citixenx writes:

“Hundreds of IBRC staff attend IBOA meeting right now.”

Meanwhile
Cotter

Update:

Anon writes:

Hi, I am a staff member at IBRC. I am sending you the below information regarding the staff grievances. Please feel free to reproduce.

 

In September 2011 an agreed redundancy package was signed off by the Bank and Government (with the input and agreement of the IBOA).
The headline terms of this redundancy package were four weeks’ base pay per year of service (inclusive of statutory redundancy entitlement);
It is envisaged that the above terms will apply in respect of redundancies made by the Bank over the next 5 years, subject to an annual review and on the basis that there is no unforeseen budgetary deterioration.
In the event that compulsory redundancies become necessary, it is proposed that the terms set out above will apply to any such redundancies.
As part of this package there were limitations around the areas within the Bank which were restricted from applying for this package as certain areas were seen as critical to the wind down programme for the Bank.
My department, which manages the loans was excluded. However, We took comfort from the clause which states that should compulsory redundancies be necessary that the terms of the voluntary redundancy scheme would apply.
Also Based on anecdotal evidence it looks like the State does not want IBRC losing critical people at this point. They will discard staff when they need to.

Please also see (below) a response from a recruitment agent to staff member at IBRC. Names have been removed:

Subject: RE: Job Application: BUSINESS ANALYST Applicant Name: . Your Ref:

Hi
Unfortunately the role you have applied for is with AIB and they will not accept any CV’s from us at the moment from IBRC employees.

Maybe you could apply direct.