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Thread: The Bank Guarantee and Anglo Irish Timeline - the Full Monty

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    Default The Bank Guarantee and Anglo Irish Timeline - the Full Monty

    I have brought together a new timeline for the Anglo Irish and Irish Banking Crisis, given the amount of information that is available across the many relevant threads here, and interest in the last week. It remains a work in progress, and corrections and additions are invited.

    Please feel free to contribute and to share this thread.

    Some conclusions on these events

    What is revealed clearly from this timeline account is that the banking crisis here was foreseen from the early 2000s, that by 2003 there was awareness that it was coming, and that at least from 2007 there were increasingly frantic efforts to keep the Anglo Irish Bank and IL & P afloat by means of share price supports, back to back loans and ELA and other EU funding.

    In the 2000s this small nation, with a small and tightly-knit post colonial capitalist class and a tiny banking system, became a sink hole for apparently unlimited cheap short term credit stimulated by European monetary union. When real economic growth tailed off here around 2000, but interest rates remained low to support the post-reunification German economy, capital looked for a new source of profit and in Ireland found it (or it seemed so) in the buying and selling of land back and fore, and in building and selling or renting buildings on it. Short term borrowing was relied on by banks to lend for over-valued property assets. The only question was when the crash would come. But all in the game wanted the one last deal.

    The regulatory and political systems were weak, the occupants of positions in them mainly lightweight and inexperienced. Local politicians were accustomed to relying on spin-off from the construction sector for donations to fund their political careers. Senior civil servants with a bloated idea of their own abilities and competence were accustomed to graduating on retirement to cosy positions in the finance sector or construction, the banks, and developers, were used to being part of the club, and to getting their own way. Bankers were unused to handling large sums of money and were proclaimed, in any case, to be geniuses for the over-rapid expansion they fuelled. The Media benefited from property advertising, and its ownership and management part of the small layer of the powerful and privileged. All these groups were long accustomed to sitting on each others Boards and protecting each others backs.

    The lid blew off the whole thing in 2008, leaving a large residual debt to be paid by a shrinking population in a devastated economy.

    The bailout decision was taken by force majeure, out of public view, by an ad hoc group of civil servants and politicians, lobbied heavily by banks and big clients of the banks, with no external checks and balances. The full Guarantee option was first outlined in writing in April 2008, in a secret contingency plan prepared by the Domestic Standing Group, mainly composed of civil servants, after the St Patrick's Day shocks to the Irish banks. There was a consensus that no bank, no matter how dead or dubious, should be allowed to close. There was fierce resistance by politicians and business interests to nationalisation. The Guarantee was a bailout conducted in a way that maximised the opportunities for insiders to fix things up for themselves. Legality is only for the little people. Whistleblowers and informed critics - well, why don’t they go and hang themselves?

    When the dust settled, salvation was offered to those in the club, and for the rest of the population, increased social division, wage cuts, suicides, lost homes, emigration and general devastation.

    As for the future, the long neo-liberal agenda of privatisation, deregulation and wage cutting is "the only game in town" for the EU and Irish political establishment.

    So long as we choose to accept it.
    Last edited by C. Flower; 15-07-2013 at 10:40 AM. Reason: q
    “ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
    — Jean-Paul Sartre

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    Default Re: Anglo Irish and Banking Crisis Timeline - the Full Monty

    Sources on the Bank Guarantee

    Main Government Reports

    Regling and Watson, Preliminary Report into the causes of the systemic banking crisis in Ireland March 2009
    http://www.bankinginquiry.gov.ie/Pre...May%202010.pdf

    Michael Honohan, Governor of Bank of Ireland - the Banking Crisis, May 2010.

    http://www.bankinginquiry.gov.ie/The%20Irish%20Banking%20Crisis%20Regulatory%20and% 20Financial%20Stability%20Policy%202003-2008.pd
    f

    http://www.socialjustice.ie/sites/default/files/file/Government%20Docs%20etc/2010-06-08%20-%20The%20Honohan%20Report%20-%20The%20Irish%20Banking%20Crisis%20Regulatory%20a nd%20Financial%20Stability%20Policy%202003-2008.pdf


    The Wright Commission Report into the Department of Finance 2010
    http://www.finance.gov.ie/documents/...deptreview.pdf

    Nyberg Commission Report "Misjudging Risk" 2011
    http://www.finance.gov.ie/documents/...bergreport.pdf

    There is a wealth of information available from the Political World Irish Economy forum threads, in particular, the Anglo Irish and Banks Crisis sub forums In many cases the threads discuss and quote reports that are now behind paywalls or no longer online, so are an invaluable public resource.

    Government documents issued to the PAC

    http://www.oireachtas.ie/viewdoc.asp.../document1.htm

    The PAC docs. in text (quotable) format.

    http://s3.documentcloud.org/document...cs-pac-all.txt

    Legislation:

    The Bill as Enacted

    http://www.oireachtas.ie/documents/b...08/b45a08d.pdf

    Credit Institutions (Financial Support) Act 2008

    http://www.tca.ie/images/uploaded/do...)_Act_2008.pdf

    Unrevised Transcripts of the Daíl debates

    http://debates.oireachtas.ie/dail/20...unrevised1.pdf

    http://debates.oireachtas.ie/dail/20...unrevised1.pdf

    https://www.google.ie/url?sa=t&rct=j...-wCh1jce84haSg

    http://debates.oireachtas.ie/dail/20...unrevised1.pdf

    Written answers:

    http://debates.oireachtas.ie/dail/20...unrevised2.pdf

    http://debates.oireachtas.ie/dail/20...unrevised2.pdf

    Page 61 - Annual Report of the Comptroller and Auditor General 2009 - refers to Central Bank liquidity payments and to the Letter of Comfort.

    http://www.audgen.gov.ie/documents/a...l1_09_rev2.pdf

    2008 Report - Bank Stabilisation Measures

    http://www.audgen.gov.ie/documents/a...t_2008Rev1.pdf

    2007 Report

    http://www.audgen.gov.ie/documents/a...eport2007b.pdf
    Last edited by C. Flower; 28-11-2011 at 09:41 PM.
    The Irish Economy Forum

    http://www.politicalworld.org/forumd...-Irish-Economy

    The Bank Guarantee subforum

    http://www.politicalworld.org/forumd...Bank-Guarantee

    The Anglo Irish Bank subforum

    http://www.politicalworld.org/forumd...h-Bank-Scandal

    The Irish Banks Crisis (excluding Anglo Irish Bank)

    http://www.politicalworld.org/forumd...c-Anglo-Irish)


    Namawinelake, the Story.ie and the Property Pin are also great online resources on the Irish economy.

    There are also expert reports that are relied on - some of them cost us quite a bit.

    Costs of Advisors

    Merrill Lynch 7 million
    R 1.4 millionInternational Crisis Timeline Honohan.
    http://www.bankinginquiry.gov.ie/The...02003-2008.pdf
    http://dail.ie/documents/committees3...document37.pdf

    This Department of Finance document, hand-dated February 28th 08 and marked "Confidential" is a thorough-going review of the steps that Government can and should take in the event of illiquidity or insolvency of one or more Irish bank.
    http://www.politicalworld.org/showth...l+Lynch+Report

    Sept. 26th 2008 Merrill Lynch email –
    http://www.rte.ie/news/2010/0716/merrilllynch.pdf
    KPMG 2 million
    PWC 75,000
    Arthur Cox 7 million
    (The Story.ie)

    Some lesser known, but excellent sources:

    The Irish Banking Crisis - Clarke and Hardiman, UCD, summarises findings of Nyberg, Hononan and Regling and Watson reports.

    http://www.ucd.ie/geary/static/publi...rywp201203.pdf

    Irish Left Review - 4 part series on the Bank Guarantee

    http://www.irishleftreview.org/search/guarantee

    George Taylor's critique of the Honohan Report

    http://ipa.ie/pdf/Administration/GeorgeTaylor.pdf

    PAC Documents assembled by the Story.ie in 2011.
    http://thestory.ie/2011/01/19/public...tee-documents/

    IMF Working Paper on Contagion Risks in Irish Banks, 2007
    http://www.imf.org/external/pubs/ft/wp/2007/wp0744.pdf

    Domestic Standing Group, Stability of Financial Institutions, meeting notes –
    http://www.oireachtas.ie/viewdoc.asp.../document2.htm

    Kevin Cardiff evidence to the PAC http://www.politicalworld.org/showth...l+Lynch+Report – summary on Political World thread.

    This Department of Finance document, hand-dated February 28th 08 and marked "Confidential" is a thorough-going review of the steps that Government can and should take in the event of illiquidity or insolvency of one or more Irish bank.
    http://dail.ie/documents/committees3...document37.pdf

    http://www.politicalworld.org/showth...l+Lynch+Report

    Merrill Lynch email – September 2008 - Options
    http://www.rte.ie/news/2010/0716/merrilllynch.pdf

    International Crisis Timeline Honohan.
    http://www.bankinginquiry.gov.ie/The...02003-2008.pdf

    Wikipedia page on the EU banking crisis

    https://en.wikipedia.org/wiki/Europe...gn-debt_crisis

    Contemporary forum discussion threads :- (what did you say?)

    http://machinenation.forumakers.com/...-for-the-banks

    http://www.politics.ie/forum/current...posits-16.html
    Last edited by C. Flower; 12-03-2014 at 12:06 AM.
    “ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
    — Jean-Paul Sartre

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    Default Re: Anglo Irish and Banking Crisis Timeline - Who's Who

    Will be added to -

    Who was who: The key players in the Irish Banking Crisis

    Politicians
    Bertie Ahern Taoiseach to 2008
    Charlie McCreevy (reportedly in touch with meetings on Bank Guarantee night)
    Brian Cowen,Taoiseach from 2008, Minister for Finance to then (at Bank Guarantee night)
    Brian Lenihan, Minister for Finance(at Bank Guarantee night)

    other Cabinet Ministers (rung about the Guarantee in the early hours of 30th September - Guarantee night: also discussed and reportedly approved in principle a Guarantee the day before in a Cabinet meeting)
    Micheál Martin
    Mary Hanafin
    Eamon Ryan
    John Gormley
    "Smith and others"

    Civil Servants
    William Beausang Department of Finance civil servant working to Kevin Cardiff (reported there at Bank Guarantee night)
    Michael Manley D o F
    Ciara Lonergan D o F
    John Hurley, Governor of the Central Bank (reported there at Bank Guarantee night)
    Con Horan, Prudential Director in charge of bank regulation under Patrick Neary, now seconded to work with the European Banking Authority (EBA) in April.
    That's the the new EU body for banking supervision which is in charge of the European banks stress tests in progress at the moment.
    You really, really couldn't make it up......
    Tony Grimes Director General of the Central Bank
    Pat Neary, Financial Regulator (reported there at Bank Guarantee night)
    Kevin Cardiff, Dept of Finance (reported there at Bank Guarantee night)
    Ann Nolan "Most senior banking official in Department of Finance." Liaison between DoF and Anglo Irish -
    http://www.politicalworld.org/showth...-Bank-to-Court
    John O'Connor
    Marie Mackle (internal "contrarian")
    http://www.independent.ie/opinion/an...-26845568.html
    Robert Pye (internal "contrarian")
    Peter “The Prof” Clinch: Special Adviser to Cowen: an environmental planner (reported there at BG night)
    Joe Lennon, Special Adviser to Cowen
    (reported there at BG night)
    Government press secretary Eoghan O Neachtain, (reported there at BG night)

    Paul Gallagher, Attorney General, (reported there at BG night)

    Consultants
    Henrietta Baldock - Merrill Lynch (based in London, advisor on Guarantee - sent email into Guarantee Night meeting)
    Merrill had been a lead underwriter of Anglo Irish’s bonds and the corporate broker to A.I.B.: they’d earned huge sums of money off the growth of Irish banking. Moments after Phil Ingram hit the Send button on his report, the Irish banks called their Merrill Lynch bankers and threatened to take their business elsewhere. They took part in back to back loans with Anglo Irish shortly before they (ML) went bust and were taken over.
    Peter Sutherland - Goldman Sachs: not employed by Government, but consulting to them in September. (Paid by Irish Nationwide?)
    Arthur Cox Solicitors - Multiple roles in legal/financial advice. http://www.villagemagazine.ie/index.php/2012/04/1630/
    Fintan Drury
    Alan Gray

    Bankers
    Seán FitzPatrick, Chairman, Anglo
    David Drumm, Chief executive, Anglo
    http://www.independent.ie/business/i...-29381731.html
    Tiarnan O’Mahoney, Anglo Irish Chief Operations Manager to 2005
    Tony O’Brien, former Chair of Anglo Irish, was appointed Chair of the Review Body on Higher Remuneration, which set politicians and higher grade public servants pay. He was also former chairman of CRH (out of which the FF aliged Ansbacher Bank was run) and former president of IBEC.
    Gillian Bowler, Chairwoman, IL&P
    John Bowe Anglo Irish Bank executive
    Peter Fitzgerald Anglo Irish Bank executive
    Dermot Gleeson, Chairman, AIB (at Guarantee night meeting)
    Eugene Sheehy, Chief executive, AIB (at Guarantee night meeting)
    Richard Burrows, Chairman, BoI (at Guarantee night meeting)
    Brian Goggin, Chief executive, BoI (at Guarantee night meeting)

    Oligarchs and Others
    Dermot Desmond (reportedly in touch with the meetings on Bank Guarantee night)
    Denis O'Brien (
    reportedly in touch with the meetings on Bank Guarantee night)
    Peter Sutherland
    JP Magner

    Economists
    David McWilliams
    Philip Lane
    Morgan Kelly
    Alan Gray, Indecon (close friend of Brian Cowen)

    Frequently encountered terms:


    Back to back loans
    The Maple 10
    The Green Jersey
    Contracts for Difference
    Domestic Standing Group for Financial Stability (DSG)
    Liquidity (skint)
    Insolvency (bust)
    ELA - European Liquidity Assistance


    Last edited by C. Flower; 30-10-2015 at 07:25 AM.
    “ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
    — Jean-Paul Sartre

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    Default Anglo Irish Bank - the Early Years

    1964 Anglo Irish Bank was established in Dublin. http://en.wikipedia.org/wiki/Anglo_Irish_Bank

    1971 Anglo Irish listed on the stock exchange. http://en.wikipedia.org/wiki/Anglo_Irish_Bank

    1977 Anglo has deposits of £2 million, cash and government securities of £1.2 million and net assets of £100,000. http://webcache.googleusercontent.co...&ct=clnk&gl=ie

    1978 Anglo was acquired by City of Dublin Bank, through its Irish Bank of Commerce subsidiary, in a £100,000 all-cash deal. An Irish Times report on the purchase stated that the Central Bank of Ireland “was worried about the financial position of Anglo ” as between 1972 and 1976, it had built up losses of £300,000. http://webcache.googleusercontent.co...&ct=clnk&gl=ie

    1980 Bank turns a profit of £100,000 and primarily provides instalment credit. http://webcache.googleusercontent.co...&ct=clnk&gl=ie

    1986 City of Dublin Bank is renamed Anglo irish Banking Corporation. Seán FitzPatrick, who had been general manager of Anglo Irish, becomes chief executive of the enlarged group. http://webcache.googleusercontent.co...&ct=clnk&gl=ie
    Seán Patrick FitzPatrick FCA served as the Chief Executive Officer of Anglo Irish Bank Corp. PLC from 1986 to January 2005, and after that was Chairman of the Strategy Board until the beginning of 2009.

    1987 Establishes Isle of Man operations to support growing sterling loan book. Deposits swell to almost £125 million. http://webcache.googleusercontent.co...&ct=clnk&gl=ie

    1988 Profit grows by 54 per cent to £2.2 million. Chairman Gerry Murphy boasts that the oldest senior executive is 42. http://webcache.googleusercontent.co...&ct=clnk&gl=ie

    1988 Anglo Irish acquired Irish Bank of Commerce. http://en.wikipedia.org/wiki/Anglo_Irish_Bank

    1992 Anglo Irish director and 15 per cent shareholder John Clegg is forced to resign following British newspaper reports that he may have been involved in money-laundering for the IRA. http://webcache.googleusercontent.co...&ct=clnk&gl=ie http://www.politicalworld.org/showth...270#post114270

    1993 Anglo claims to be taking deposits of £1 million a day during the currency crisis but Murphy reassures shareholders that “Anglo" does not, has not and will not speculate”. Annual profits reach £7.3 million. In July the “Clegg holding” of 18 million shares is finally sold http://webcache.googleusercontent.co...&ct=clnk&gl=ie

    1995 Bought Royal Trust Bank (Austria), a subsidiary of Bank of Canada, which has no loan book but deposits of £235 million providing “a cheap source of funding for future lending”, says director Tiernan O’Mahoney. FitzPatrick says Anglo’s target market is asset backed loans averaging £400,000. Deposits exceed £1.4 billion. http://webcache.googleusercontent.co...&ct=clnk&gl=ie

    1995 Anglo Irish acquired Royal Trust Bank (Austria), a bank with a 100-year history, from Royal Bank of Canada and renamed it Anglo Irish Bank (Austria). Anglo Irish also acquired a loan portfolio from Allied Dunbar. http://en.wikipedia.org/wiki/Anglo_Irish_Bank
    1996 – Anglo Irish acquired Ansbacher Bankers, which was established in Dublin in 1950.
    Yes – that Ansbacher Bank. http://www.gavinsblog.com/2009/05/03...port-complete/
    http://en.wikipedia.org/wiki/Anglo_Irish_Bank http://www.independent.ie/national-n...an-386659.html

    "The (Moriarty) tribunal heard also of the stg £100,000 payment made to Charles Haughey in September 1994. It was transferred on September 20 and involved a payment by Anesia Etablissement, Banque Scandinave, Geneva. It was in favour of Henry Ansbacher and Company for further credit to Cayman International Bank Trust Company and to the Royal Bank of Scotland in London.
    Another payment of stg£25,000 was also made for the benefit of Mr Haughey on October 28, 1996 being paid through the Anglo Irish Bank Corporation in the Isle of Man to the Royal Bank of Scotland in Jersey for the account of AIB (Channel Islands).
    … Mr Desmond has stated that he had only two dealings with Des Traynor which related to Mr Haughey. One was in or about November 1987 when he was asked if he would participate in a five or six person syndicate to advance funds to repay ``our friend's borrowings''.
    In a memo to the tribunal, the former NCB chairman has said he understood this to refer to Mr Haughey but he declined this approach. Sometime in or about 1988 Mr Traynor asked him to move private accounts from Guinness and Mahon to NCB. Desmond admitted that the risk factor surrounding the loan to Conor Haughey for repair of Celtic Mist (a loan of £75,000 for refurbishment of the family yacht. Note: CF) was not of concern to him.”

    1998 Anglo Irish acquired Crédit Lyonnais (Austria) and combined it with its existing Austrian operations. http://en.wikipedia.org/wiki/Anglo_Irish_Bank

    1998 Anglo establishes a US operation in Boston and purchases units of Credit Lyonnais Bank in Austria for £10.1 million. Profits rise 49 per cent to £45.1 million. http://webcache.googleusercontent.co...&ct=clnk&gl=ie
    Last edited by C. Flower; 29-06-2013 at 03:09 PM.
    “ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
    — Jean-Paul Sartre

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    Default Re: Anglo Irish and Banking Crisis Timeline - The Euro and EMU arrive

    1st January 1999 The Euro launched: Ireland joins. http://en.wikipedia.org/wiki/History_of_the_euro
    “With the establishment of the EMU and the introduction of the Euro, Europe has opened up with the creation of a proper single financial market and the resulting level of competition between financial institutions is becoming fierce. Virtually all European countries have had vigorous programmes of privatization underway, following Britain’s lead under Thatcher. This has greatly accelerated the formation of an efficient pan-European equity market. Vast amounts of deregulation have ushered the powerful forces of free market into every corner of Europe.”(High Finance in the Eurozone, Walter and Smith, Prentice Hall).

    Membership of the Eurozone led to a decrease in nominal and real interest rates and also removed the exchange rate risk associated with European borrowing. As a result, Irish banks became increasingly reliant on short term borrowing in the Euro area. By the end of 2006, wholesale borrowing by Ireland in the euro area markets for the aforementioned six Irish financial institutions reached about 39 per cent of their combined loan books.
    The growth in short-term borrowing increased at an even greater rate such that one year remaining maturity or less amounted to 41 bn at end 2006 for two largest banks, up from 1 bn at end of 2003. (Regling and Watson, 2010, p 33). Nyberg found that when supply of credit exceeded good quality demand for loans, standards dropped, and non-recourse loans, without guarantees, or any real collateral were made.

    1999 – Anglo Irish acquired Smurfit Paribas Bank, a joint-venture that Banque Paribas had helped establish in Dublin in 1983. Anglo – Irish also bought a loan portfolio from Bayerische Hypo-und Vereinsbank.http://en.wikipedia.org/wiki/Anglo_Irish_Bank

    1999 Buys Smurfit Paribas Bank for £30 million cash. http://webcache.googleusercontent.co...&ct=clnk&gl=ie

    2001 46 per cent rise in pre-tax profits to €194.8 million, about a third of which is generated overseas. FitzPatrick says Anglo aims to increase lending at 15-18 per cent each year. Defending the levels of directors’ remuneration, he says the bank has “a policy that rewards success” http://webcache.googleusercontent.co...&ct=clnk&gl=ie

    2001 Anglo Irish acquired Banque Marcuard Cook & Cie. in Geneva, Switzerland, and renamed it Anglo Irish Bank (Suisse). http://en.wikipedia.org/wiki/Anglo_Irish_Bank
    Last edited by C. Flower; 30-06-2013 at 06:29 PM.
    “ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
    — Jean-Paul Sartre

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    Default Re: Anglo Irish and Banking Crisis Timeline - The Bubble

    2002 -2005 Growth of the Bubble

    Honohan on the “classic” Irish property bubble: “Only the scale was new. From 2003 the banks leveraged their local resources with enormous borrowings from abroad (easily available due to the global savings glut, and also to the lack of exchange rate risk for euro borrowing). At the end of 2003, net indebtedness of Irish banks to the rest of the world was just 10 per cent of GDP. By early 2008 that had jumped to over 60 per cent. The preconditions for growing housing demand gradually emerged with the sustained export-led real economic expansion from 1988 and especially from 1994 (Celtic Tiger period).”
    http://www.timesonline.co.uk/tol/new...cle7069681.ece

    “Between 1994 and 2007 average real house prices tripled.

    Monetary Union (EMU) entry that really started the housing price surge by sharply lowering nominal and real interest rates, thereby lifting equilibrium asset prices (Figure 2). The combination of higher population, higher income and lower actual and prospective mortgage interest rates clearly provided a straightforward upward shift in demand, i.e. in the willingness and ability to pay for housing. The problem is that property prices developed their own momentum and overshot equilibrium levels as calculated by all models” http://www.esr.ie/Vol40_2/Vol-40-2-Honohan.pdf

    2003 – Rents started to fall as housing supply was meeting demand. “Rents have been falling, according to the Central Statistics Office for over 18 months now.” The prospect of a property crash was discussed at a conference by Senior bankers and economists in 2004, according to David McWilliams, writing in 2005. Article is short, and is essential reading: http://www.davidmcwilliams.ie/2005/0...redit-runs-out

    2003 David McWilliams calls the Irish housing market at scam, a conspiracy between developers and landowners. Mortage lending going up 10 times faster than wages. Disaster looming for the young generation of buyers.



    2004 David Drumm (37) is appointed chief executive as Fitzpatrick steps down after 22 years. He earned €2.3 million in his last year in the job. Fitzpatrick remained as Chairman of the Strategy Board.

    ANGLO IRISH BANK may have known from as early as 2004 that it was facing the prospect of bankruptcy, the Master of the High Court Edmund Honohan has said in his submission to the Wright Commission, which is investigating the actions of the Department of Finance during the boom years.

    The Irish Mail on Sunday reports that Honohan suggested Anglo may have been operating “a sort of Ponzi scheme” in order to avoid insolvency because the bank’s leaders “knew it would go bust if there was a ‘soft’ landing”.Honohan was also sharply critical of the Department of Finance, saying that it had relied on “tradition, gut instinct and the anecdotal” when evaluating its policies.
    Read Ken Foxe’s report in the print edition of the Irish Mail on Sunday >
    http://www.politicalworld.org/showth...to-2009/page16

    2004 “Bank of Ireland introduced a 100 per cent 35-year mortgage for first-time buyers – the littlest of the little guys. This move follows the First Active 100 per cent mortgage that was announced two weeks ago. The bank says that this is necessary, and that most little guys will be able to service the higher borrowings. It has put some fairly cosmetic restrictions on who can qualify, but in reality it is throwing money at anyone who comes through the door. Rather than making houses more affordable, this type of product simply pushes the price of Irish houses up further, forcing the banks to lend even more cash against the same asset this time next year. Friday’s central bank figures showed more than �2 billion was extended in mortgage credit in June, the highest ever monthly total.”

    http://www.davidmcwilliams.ie/2005/0...redit-runs-out

    October 2004
    Robert Pye, Assistant Principal Officer in the Department of Finance, met with three Assistant Secretaries to communicate to them his serious grounds for belief that "international shocks" would lead to a devastating crash in the Irish property and finance sectors. He later produced a paper showing why he considered that such shocks were inevitable by 2008 at latest. http://books.google.ie/books?id=G97o...ission&f=false

    January 2005 - Marie Mackle, Assistant Principal Officer in the Department of Finance, began to draft answers to Parliamentary Questions that (based on IMF, OECD, E.S.R.I. and Central Bank reports) warned of the possibility of a serious housing crash.
    http://www.independent.ie/opinion/an...-26845568.html

    2005 Tiarnan O’Mahoney, Anglo Irish Chief Operations Manager, known for applying a “TIBOR” interest rate to more naïve corporate customers, resigned when he did not get the CEO job as expected. He then set up ISTC, a lending firm, that went on to make spectacularly large losses, and which involved many key Anglo players. In 2005 he was appointed as head of the Pensions Board by Martin Cullen. http://www.politicalworld.org/showth...-job-in-Anglo! http://en.wikipedia.org/wiki/Anglo_Irish_Bank

    2005 Tony O’Brien, former Chair of Anglo Irish, was appointed Chair of the Review Body on Higher Remuneration, which set politicians and higher grade public servants pay. He was also former chairman of CRH (out of which the FF aliged Ansbacher Bank was run) and former president of IBEC. http://www.politicalworld.org/showth...6372#post56372
    .
    2005 Anglo Irish results - lending up by 10 billion, profits up by 36%. However, the NTMA did not buy into it. http://www.finfacts.ie/irishfinancen..._bo_4021.shtml

    A SEPARATE THREAD HERE ON THE YEARS 2006- 2008 -

    http://www.politicalworld.org/showth...e#.UuvrMyGceCc

    2006 - A number of loans made to children of S. Fitzgerald, and one to a very young staff member, amounting to hundreds of millions. Documentation of the loans appears to have disappeared after the Guarantee and before the raid on Anglo Irish in 2009.

    http://www.politicalworld.org/showth...=property+boom

    30 March 2006

    The Minister for Finance, Mr Brian Cowen, TD, today indicated that, in view of uncertainties and difficulties of which he had become aware, he plans to review the law as it relates to stamp duty on share transactions which underlie trading in Contracts for Difference based on Irish equities. The Minister said that he was anxious that the market in Irish equities would continue to be a modern, liquid market, conducive to capital acquisition by Irish firms. His Department would consult with the Revenue Commissioners and with market participants with a view to appropriate announcements being made in Budget 2007.

    http://www.finance.gov.ie/viewdoc.asp?DocID=3860
    Last edited by C. Flower; 31-01-2014 at 05:38 PM.
    “ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
    — Jean-Paul Sartre

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    Default Re: Anglo Irish and Banking Crisis Timeline - Pumping up the Jam 2006-2007 - Liquidity Assistance Begins

    2006 In March 2006, the Department of Finance reversed a move by the Revenue Commissioners to charge stamp duty on stock purchases through contracts for difference (CFDs)... (Quinn) used them to secretly build up his enormous stake in The Bank Formerly Known as Anglo, relying on heavy borrowings in the process.A CFD punter was allowed to take a 100 per cent interest in a rising share price, while only paying as little as 20 per cent up front in cash and effectively borrowing the rest.

    “It looked like handy money in the go-go years, when stocks were only going one way – up! So when Revenue introduced a stamp duty charge over the St Patrick’s weekend in March 2006, the stock exchange and financial industry were up in arms, fearing that this lucrative business, which accounted for more than 30 per cent of the market in Irish shares, would go to the UK or elsewhere.
    ... Kevin Cardiff, as assistant secretary in the tax policy section in finance, came in for some heavy duty lobbying at the time. He became second secretary general of the department the following December when he took charge of all matters relating to banking policy. Before the planned duty was rescinded, Mr Cardiff sent a detailed note to Cowen about CFDs and explained why the proposal to tax them “was causing consternation in the market for Irish shares”. The minister duly noted the advice of his official and the idea was scrapped.
    ... a letter that was sent to Cardiff on March 30th, 2006 by a very grateful Tom Healy, then chairman of the Irish Stock Exchange. “Kevin, I would like to thank you for getting the CFD problem resolved. We had the very clear impression that you were the one who fixed it. “I will contact you soon to propose lunch.”

    The question has been raised as to whether Sean Quinn was encouraged by Cabinet Ministers to go about buying up distressed firms, late 2006. If anyone has any information about this, please contact me or post on this thread.

    RIchie Boucher of Bank of Ireland in his May 2015 evidence to the Banks Inquiry said that BoI was asked if it would take over INBS.


    January 2007 It was reported that Seán Quinn bought a 5% stake of Anglo Irish Bank for US$ 750 million. http://en.wikipedia.org/wiki/Anglo_Irish_Bank “January 2007: Sean Quinn is reported to have secretly built up a 5% stake in Anglo Irish Bank using CFDs.”

    January 2007 Consultants Oliver Wyman named Anglo Irish Bank as the best bank in the world in a piece of research published to coincide with the World Economic Forum in Davos, Switzerland[43][44][45] http://en.wikipedia.org/wiki/Anglo_Irish_Bank

    February 2007: Banking shares hit record highs, trebling in value since 2000.

    2nd February, Brian Cowen met Fintan Drury (former Anglo Irish Director) - Brian Cowens diary for 2007

    March 2007: Residential property prices fall for the first time since the start of the boom.
    http://www.timesonline.co.uk/tol/new...ffset=0&page=1.

    17th April 2007 Morgan Kelly on Primetime forecasts a collapse in property prices and massive bank losses – “over a quarter of million empty houses…rents have not gone up since 2000 and are amongst the lowest in Europe.”

    May 2007, Cowen as Finance Minister introduced legislation that enabled Irish banks to increase their lending for commercial development. http://kathleenbarrington.blogspot.c...nks-folly.html

    Cowen and John Hurley, Governor of the Central Bank, say that Ireland will have a soft landing.

    http://www.independent.ie/business/i...-29419750.html

    May 2007 – General Election

    23rd June 2007 -US: Bear Stearns pledges $3.2 billion to aid one of its ailing hedge funds (Honohan Report)

    July 2007 – Taoiseach Bertie Ahern raised laughter and applause when he responded to Morgan Kelly and others “cribbing and moaning is a lost opportunity in fact I don’t how people who engage in that don’t commit suicide”. http://www.youtube.com/watch?v=hfjGSfuSQpA

    July 2007 spreads rose "but mainly on account of common global factors" - Subprime crisis starts.

    July 2007 A group of officials in the Department of Finance, the Central Bank and the Financial Regulator discussed the stability of Anglo Irish Bank and other financial institutions (Domestic Standing Group on Financial Stability - DSG). Briefing material drawn up for the department’s secretary general shows that the positions of individual institutions were discussed. However, it states that the “full extent of the fragile position of the banks only became clear after the bank guarantee scheme was put in place”. The group was established on foot of measures agreed at EU level aimed at strengthening financial stability in states. Its role was to facilitate the speedy exchange of information regarding financial stability and to prepare contingency plans in the event of any major risks.

    July 2007 - New Liquidity Regulations came into force: jail sentences and fines to apply to breaches.

    Late July or early August 2007 at Unicredit Bank in IFSC - a breach actually was reported.

    In mid 2007 a whistleblower, Jonathan Sugarman, went to the Regulator to report a liquidity breach at an Irish subsidiary of a European bank, Unicredit, based in the IFSC. When nothing was done about it, he resigned, to protect his own legal position. From Kathleen Barringtons's blog. http://kathleenbarrington.blogspot.c...g-at-ifsc.html "From the commencement of the operation of the regulations in July 2007 until Whistleblower’s resignation in mid-September of the same year, several daily liquidity reports showed the bank to be well beneath the 90% threshold.” A letter was prepared which notified the Financial Regulator that the bank’s liquidity ratio stood at only 70% but promised to remedy the situation immediately. This is a very serious matter as the margin of appreciation allowed under the regulations is a mere 1%. This represented 20 times the allowable margin. Thus is established a clear and unbroken chain of evidence implicating not only the bank but also the Financial Regulator (Source:Oireachtas records: Norris) http://debates.oireachtas.ie/seanad/...2/23/00012.asp The Chairman of Unicredit at the time was Brian Hillery, Chairman of Independent News and Media and from 2008 a Director of the Central Bank.
    http://en.wikipedia.org/wiki/Brian_Hillery

    A video interview and transcript here -
    http://www.abc.net.au/foreign/content/2011/s3367080.htm[

    This matter was raised in the Austrian Parliament and the Senate, but was dismissed by Brian Lenihan as not amounting to a serious breach when Joan Burton raised it in writing. There has been more international TV coverage of this than Irish - not covered by RTE or TV3 in spite of numerous Irish and international newspaper articles and television coverage. Sugarman continues to campaign for the authorities to act in accordance with the law.

    David Norris raising this in the Senate -
    http://www.skeptive.com/sources/1483...ce_urls/264397

    August 2007 Irish banks have lent beyond the deposits taken in during the property boom; they bridge the gap of about €200 billion by borrowing in international markets (Simon Carswell, IT, Sept. 25th 10)
    Somers also confirmed that Brian Cowen had also issued ministerial orders instructing him to make large cash deposits in Irish banks in late 2007. He said Cowen had ordered him to leave funds in AIB, BOI, EBS and IL&P after the NTMA began withdrawing large cash deposits from Irish institutions which Somers believed were in financial difficulties as early as August 2007 (TheStory.ie)

    31st August 2007 – Domestic Standing Group met – Regulator had been working on “minimizing reputational damage” to Irish banks and was keeping a close eye on several institutions: “One or two (firms) where liquidity problems had caused difficulties for associated sponsoring banks”

    http://www.oireachtas.ie/documents/c.../document2.pdf

    September 2007
    Anglo Irish find out about Sean Quinn’s 25 pc stake in the bank paid for by Contract for Difference and inform the Regulator. They start to try to get this reduced down to 10 pc. http://m.irishtimes.com/newspaper/fi...html?via=bnews

    On September 11, 2007, Sean Quinn met Anglo chief executive David Drumm and chairman Sean FitzPatrick at the Ardboyne Hotel in Navan, where Quinn disclosed that he owned 24 per cent of the bank through CFDs.
    The family is now maintaining that the regulator was notified immediately, referencing the O'Connor report: "After this meeting, the board was informed of SQ's CFD positions, and it was decided that the regulator be informed immediately. David [Drumm] met and advised Pat Neary immediately."

    In its 2009 report Arthur Cox also points to significant engagement between the bank and the regulator after the Ardboyne meeting: "There followed a series of bilateral discussions between the bank and the regulator, and, as the bank understands it, Quinn and the regulator.

    http://www.politicalworld.org/showth...086#post346086

    12th September 2007 Cowen met Hurley, (diary) http://www.rte.ie/news/2007/0915/business.html

    August - September 2007 - liquidity crisis kicks in

    There had been borrowings from the ECB for liquidity purposes. Everything blamed on international conditions.
    “If as early as 2007 Anglo Irish Bank was having liquidity problems, as now seems clear, and if the NTMA refused to increase deposits at the bank, who then, provided liquidity? (most likely around the time of the Northern Rock crisis, a bank with similar issues to Anglo).
    …In July 2007 the other assets stood at €3.8bn. By late September they had almost quadrupled to €12.3bn. Just what was this for? At the time this was a record for the Central Bank, a record that in recent months has long since passed (other assets in December stood at €51bn).

    And just one more thing. Perhaps a clue lies with our own Central Bank. For around that time, the ‘Other Assets; of the Central Bank increased dramatically for a period of three months. Here’s a graph of the those assets from September 2006 (around the property peak) to late 2008 (pre Anglo nationalisation but post guarantee)”

    “It seems that someone needed ELA (Emergency Liquidity Assistance) in September 2007 following the collapse of Northern Rock. "Somebody 'blew up' in September 2007 to the tune of 8.5 bn. Quite a figure that, isn't it? Coincidentally, Anglo needed 7bn in fake deposits from IL&P in September 2008 to window dress its year end that year and 10.4 bn the year after from the MLRA from the ICB."

    http://blog.cornerturned.com/2011/01...-assets-again/

    Autumn 2007-Cowen sets up Advisory Forum on Financial Legislation - Arthur Cox partner chaired it: Davy Stockbrokers and other private sector interests invited by Cowen to work on drafting financial legislation, 2007-2009. Was this constitutional?

    "The Advisory Forum on Financial Legislation was set up by Taoiseach Brian Cowen when he was minister for finance and held seven meetings between the autumn of 2007 and November 2008[/COLOR]. It was quietly disbanded during 2009 at a time when light-touch, or principles-based, regulation was being increasingly blamed for contributing to Ireland’s regulatory failures.
    The forum had a brief to draft Heads of the Bill for a modernised financial regulation scheme that would consolidate 45 Acts and over 150 pieces of secondary legislation. The forum was chaired by Pádraig Ó Ríordáin, the managing partner of Arthur Cox solicitors, membership of the forum, as well as its drafting subgroups, was dominated by the financial industry and the private sector. It is rare for private sector interests to be involved in the drafting of legislation: in this instance the Government asked the financial industry to become involved in helping draft legislation that would have the effect of regulating the industry itself in future. A Finance position paper from March 2007 stated: “Lawyers from the important sectors of banking, insurance, funds and investment sectors would be closely involved in the steering group.”
    The Irish Times - Monday, April 26, 2010

    In January 2008, Mr Cowen said to the forum it had full Government approval to ensure full “involvement of the wider community of interests”.
    The forum’s task was to prepare for “cross-sectoral principles-led regulation of the financial sector” within 12 months.
    The minutes of its meetings, as well as internal Department of Finance documents, show that the forum adopted the light-touch approach of then financial regulator Pat Neary. (IT, FOI Act)

    Nine of its 23 members were drawn from the banking and finance sectors, compared to only six members from government departments.
    Four members represented consumer interests; one member was a trade union representative, one member represented credit unions; and one member was from the community sector.
    The subgroups charged with drafting the proposed legislation were also dominated by the private sector. An internal Finance memo from January 2007 said that its expectation was that the private sector would provide expert personnel whose pay would be resourced by the industry itself.
    Of the 19 members of the drafting subgroups, five came from the government side: two from the Financial Regulator’s office; and three from Finance. The others were drawn from private law firms and banks including Merrill Lynch, Arthur Cox, AL Goodbody, McCann Fitzgerald, Educational Building Society, Bank of Ireland, Mason, Hayes and Curran, Davy and the Irish Stock Exchange."
    Last edited by C. Flower; 08-05-2015 at 09:07 PM.
    “ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
    — Jean-Paul Sartre

  8. #8
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    Default Re: Anglo Irish and Banking Crisis Timeline - Staving Off Collapse - the Bail Out Begins

    September 14, 2007 Northern Rock was forced to go to the Bank of England for funding. Was Anglo also receiving funding, and was a quiet bank run underway? How aware was the Department of Finance and the government of problems at Anglo in September 2007 and the months that followed. http://www.rte.ie/news/2007/0915/business.html

    15 Sept 2007
    - Northern Rock collapse http://www.rte.ie/news/2007/0915/business.html

    "It seems that someone needed ELA (Emergency Liquidity Assistance) in September 2007 following the collapse of Northern Rock.”http://thestory.ie/http://www.rte.ie/news/2007/0915/business.html

    September 2007 Anglo Loans were advanced to seven companies in the Quinn Group after September 2007.

    Aoife Quinn, the only plaintiff to file an affidavit, said the bank gave the loans “in the full knowledge” that they were to be used “to support CFD positions [in Anglo]”. She claimed the loans were “in support of an illegal objective of market manipulation” prohibited by EU market abuse rules.
    Anglo’s lending was “tainted with illegality or was intended to support an illegal purpose”, she said. For that reason, the bank’s loans to the family were unlawful, invalid and unenforceable.

    According to the Irish Times account of the Anglo Irish trial, Feb 2014, 2 billion were loaned by Anglo Irish to Quinn between November 2007 and July 2008. I am not sure why there is a difference between the dates - Aoife Quinn says it started Sept. 2007.

    4th October and 16th October Brian Cowen met Fintan Drury, a former Director of Anglo Irish Bank. http://www.independent.ie/opinion/an...-26612825.html

    5th November 2007 - Anglo Irish shares down 6% - http://www.angloirishbank.com/Media-...September.html

    "We are living on short term fixes" (Anglo Tapes)

    20% chance of a bond default by Anglo Irish bet on by the markets at this stage - http://www.politicalworld.org/showth...125#post361125

    Let the lads just tidy up their files and ******* help out with future bond issues and what have you, and ******* just brush up on their fuckin' German," Mr Drumm says. "Just, eh, right now lending isn't the game."
    Mr Drumm does not explain exactly why Anglo employees would need to learn German. But it is likely he was referring to the fact that the ailing bank would need European Central Bank – which is based in Frankfurt – support to stay afloat.
    In another foul-mouthed tirade, Mr Drumm then discusses the best way to convince the board of the bank to shut off the lending taps without telling ordinary staff, who he refers to as "the children".
    "We should have that ******* debate, not in front of the children [ordinary employees] by the way," Mr Drumm tells Mr Bowe.
    "Now is the hour. If we agree that now, and there will be push back on that . . . They [the board] will be too conservative, too negative but I am with you, this [the financial crisis] could go on and on."

    Mr Bowe admits that Anglo is already beginning to crack under the pressure. "There is only a finite amount of time we can keep going the way we are going," he says.
    "We don't have collateral we can pledge, loans we can turn into covered bonds . . . we are living on short-term fixes at the moment."

    This suggests that Bowe thought they would be unable to borrow even from the ECB, due to lack of collateral.
    http://www.independent.ie/business/i...-29418362.html

    Early November 2007 - "Anglo Tapes call" - John Bowe - mentions two loans from the ECB in the previous 3 months and other desperation measures to keep the bank afloat.

    The two executives rehearsed what they would tell investors about the situation, including the ECB loans if asked.
    "'What have you done, have you accessed ECB?' We've accessed ECB funding twice in the last three months for a total of €360m, right. You know what I mean, so you actually, but you're not putting ... " John Bowe says.
    "Do we answer 'yes' to that or do we just say 'f***in' no?'" Declan Quilligan wonders.
    "No, but people do read that as negative John. If I was to read that right now I would say 'oh *******', whereas it's a nothing. . . ," Mr Quilligan says.
    "I don't think it's credible to say that you haven't drawn anything against ECB," Mr Bowe replies.

    http://www.independent.ie/irish-news...-29416977.html

    Anglo, according to this call, was breaching ratings agency risk limits in its borrowings.

    There is more here on the 2007 bailout of Anglo Irish Bank.

    In October, Anglo Irish raised 2 bn by selling part of its mortgage book. The bank was second only to Northern Rock in cost of Credit Default insurance and there was fear of a run to the tune of €10 billion.

    November 2007 Anglo Tapes, via the Independent.
    Mr Drumm and Mr Bowe discuss whether it would be possible to get Mr Hurley to make a public statement of confidence in the Irish banks. At one point, Mr Drumm snaps: "No, no, forget about reality because it's not working. Is there anything they (Central Bank) could say?" But it is also clear the bank chiefs knew that Ireland's credibility on the international market was already damaged and that any statements could backfire. The Anglo bosses discussed asking Mr Hurley to deny any Irish bank had to turn to the European Central Bank because they couldn't borrow money using normal channels. Also discuss getting Quinn to say he is buying shares when in fact he is selling.
    http://www.independent.ie/business/i...-29582014.html

    RTE stepped in and obliged with this soft interview of Sean Fitzpatrick, who nevertheless admitted the future for Anglo Irish was uncertain.

    <strong>


    December 2007
    The family of Seán Quinn are claiming in their legal action against Anglo Irish Bank over the validity of €2.34 billion in loans that the bank advanced €500 million in December 2007 under the “false guise” of property lending. http://www.politicalworld.org/showpo...9&postcount=32
    They allege the loans were in fact provided to “tidy up” loans advanced to meet losses on Mr Quinn’s investment in Anglo shares through contracts for difference, a type of leveraged bet on the bank’s share price. The loans were provided after conversations between Mr Quinn and Anglo chief executive David Drumm in December 2007 following falls in the bank’s share price.
    The €500 million loans were given under the “false guise” of gearing up on property at one of their companies, Quinn Finance, but were in reality used to clear up loans to meet margin calls on the Anglo contracts, they allege.

    December 2007 -Crisis Simulation Exercise by DoF, Central Bank and Regulator. http://www.oireachtas.ie/documents/c...document36.pdf

    Late 2007 Brian Cowen brought Seán Fitzpatrick into his "kitchen cabinet" (IDM).

    Referring to a letter marked 'strictly confidential' which the then-Finance Minister Brian Cowen had written to him in December 2007, in which Mr Cowen requested his "views" on the role the NTMA could play in helping to maintain financial stability, Dr Somers revealed how this had been preceded by several months of pressure from senior officials in the Department of Finance to put Irish public funds into the banks to help shore them up.

    It was this official pressure, and not Mr Cowen's letter that had prompted him to seek legal advice on the NTMA's position when it came to taking a risk with the Irish banking system. Dr Somers said that he wanted to be clear that the agency was complying with its legal obligations before risking monies that were meant to "keep the State on the road". "There was a lot of pressure coming on from officials. It had been coming over the previous few months to assist the banking system, to put money with these guys. "My attitude was that the monies I raised were to keep the State on the road. It wasn't to bail out the banks, which weren't my legal responsibility. So I wanted to make sure that whatever I did, I did it according to the laws of the land. http://www.independent.ie/national-n...s-2498059.html

    In relation to the NTMA, http://politico.ie/index.php?option=...ics&Itemid=877 Vincent Browne also raises some interesting questions in relation to Michael Somers’ interview:

    December 2007 “David Drumm, then CEO of Anglo Irish Bank says Brian Cowen had been asked to help with the NTMA and had expressed annoyance about the obduracy of the NTMA; Brian Cowen denies he made any representations on behalf of Anglo.” “Anglo Republic", see page 162/163:
    It also emerged in January 2011 that Cowen as Minister for Finance had asked the NTMA to deposit additional funds in the Irish banks - in all of them, not just Anglo - in December 2007 because of the serious liquidity issues they were under at the time. Somers had sought legal advice before agreeing to the request. He said he had got 'a bit of heat' from Department of Finance officials not to reduce NTMA's own deposit levels in general across the Irish banks, despite his own personal concerns about Anglo. The advice said that he should get written instructions from the minister before depositing any more of NTMA's funds with the Irish banks. In the end the NTMA placed the deposits under direction from the Minister.

    Somers also confirmed that Brian Cowen had also issued ministerial orders instructing him to make large cash deposits in Irish banks in late 2007. He said Cowen had ordered him to leave funds in ABI, BOI, EBS and IL&P after the NTMA began withdrawing large cash deposits from Irish institutions which Somers believed were in financial difficulties as early as August 2007.

    Quote:
    Referring to a letter marked 'strictly confidential' which the then-Finance Minister Brian Cowen had written to him in December 2007, in which Mr Cowen requested his "views" on the role the NTMA could play in helping to maintain financial stability, Dr Somers revealed how this had been preceded by several months of pressure from senior officials in the Department of Finance. It was this official pressure, and not Mr Cowen's letter that had prompted him to seek legal advice on the NTMA's position when it came to taking a risk with the Irish banking system.

    Dr Somers said that he wanted to be clear that the agency was complying with its legal obligations before risking monies that were meant to "keep the State on the road"."There was a lot of pressure coming on from officials. It had been coming over the previous few months to assist the banking system, to put money with these guys. "My attitude was that the monies I raised were to keep the State on the road. It wasn't to bail out the banks, which weren't my legal responsibility. So I wanted to make sure that whatever I did, I did it according to the laws of the land. http://www.independent.ie/national-n...s-2498059.html

    Late 2007 – 100 billion put into Depfa Bank by the German Government, after Irish based /IFSC losses.
    http://www.politicalworld.org/showth...389#post115389 Ireland did not regulate IFSC institutions (aka “the Wild West”).

    At End of 2007 (calendar, or accounts year?) On pages 136/137, "Anglo Republic", Simon Carswell discusses an IL&P results presentation on 27 February 2008 - a month before the "green jersey agenda" was mooted by Hurley: As the bank's own borrowing costs in the markets rose... IL&P was forced to turn to the European Central Bank for funding...the company had borrowings of €5.3 billion from the ECB but had since reduced this to €4.6 billion. This still accounted for well over 10 per cent of the company funding.

    December 14th 2007 – Anglo Irish announces the sale of its Swiss Bank to a Swiss regional bank.

    http://www.finfacts.ie/irishfinancen..._1012116.shtml

    January 2008: Legal advice taken on Sean FitzPatrick 's hidden loans. He is given the all clear http://www.timesonline.co.uk/tol/new...ffset=0&page=1

    January 2008 The Financial Regulator first uncovered the €87 million loans in when inspectors from the regulator's offices carried out an inspection into the loan book of rival lender, Irish Nationwide Building Society. The inspectors noticed that a large loan was provided to FitzPatrick at Anglo Irish Bank and later repaid. The Regulator discovered at a later date that similar loans were provided to FitzPatrick in September 2008 and repaid by him in October 2008.

    When the issue was raised with Anglo Irish Bank it was discovered that there were further loans between the two banks over an extended period of eight years
    .

    17th January 2008 - Domestic Standing Group (Financial Stability) (DSG) meets and discusses Financial Stability Scoping paper - Guarantee discussed. This and subsequent DSG papers also discuss "Constructive Ambiguity" - the extent to which it was legal or desirable to lie to the public about the state of the banks.

    http://www.oireachtas.ie/documents/committees30thdail/pac/reports/documentsreguarantee/document35.pdf

    24th January 2008 - Confidential Department of Finance Scoping Paper - Financial Stability Issues - thorough scoping of possibilities and options for illiquid and insolvent banks - several mentions of guarantees of various kinds. Includes discussion of the legal issues surrounding Guarantees of illiquid and insolvent banks http://www.oireachtas.ie/documents/c...document37.pdf

    http://www.politicalworld.org/showth...192#post348192

    http://www.thepropertypin.com/viewto...p?f=19&t=35376

    These two "confidential" documents, and a further in April, set out the legality, or otherwise, of a range of options for dealing with illiquid or insolvent banks.

    23rd January 2008 - ¶4.
    (SBU) On the economy, Cowen and his deputy, Kevin Cardiff, said that, while prices have dipped slightly, the housing market remains healthy. Cardiff noted that the "underlying demographics support the current level of house prices" and that the government does not expect a steep price drop. Cowen said that Irish banks remain well capitalized and do not seem to be having difficulties.
    http://www.cablegatesearch.net/cable...diff%20ireland
    Last edited by C. Flower; 29-04-2014 at 01:44 PM.
    “ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
    — Jean-Paul Sartre

  9. #9
    Join Date
    Feb 2010
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    Default Re: Anglo Irish and Banking Crisis Timeline - the Green Jersey - Secret Share Price "Supports"


    graph from Constantin Gurdgiev's blog spot


    Some details from the Anglo Irish trial have been added to the timeline from Con Horan (the regulator)'s evidence on Monday from today's Irish Times, reported by Ruadhán MacCormaic (from the print edition of the Times) - marked up in dark green.

    http://www.irishtimes.com/news/crime-and-law/courts/regulator-official-tells-court-of-drumm-call-1.1719571

    http://www.rte.ie/news/2014/0310/601190-anglo-trial/

    From Eamonn Quinn in the WSJ.

    http://www.rte.ie/news/2014/0310/601190-anglo-trial/

    February 8th 2008
    Department of Finance’s Powerpoint presentation to the Domestic Standing Group re Overview of Financial Stability Resolution issues http://www.oireachtas.ie/documents/c...document36.pdf
    Stated (original emphasis)
    As a matter of public policy to protect the interests of taxpayers any requirement to provide open-ended /legally binding State guarantees which would expose the Exchequer to the risk of very significant costs are not regarded as part of the toolkit for successful crisis management and resolution.
    20th February 2008 (Source: Anglo Trial Feb 2014) Meeting between Liam McCaffrey.. Seán Quinn,former chairman of the Quinn group, and others including Patrick Neary, the financial regulator, and Con Horan, prudential director. The note dated February 20th, 2008, described Quinn as having"apologised sincerely for the trouble he had caused by taking money out of his insurance company to fund his outside investments in shares (Question from C. Flower - was this legal under the Companies Acts?)
    http://www.irishtimes.com/news/crime...nces-1.1685035


    February 22nd 2008 - "The Court was shown minutes of a meeting of the Domestic Standing Group on February 22nd 2008. This forum was established in 2006. This forum was established in 2006 to ensure "preparedness for emergencies" Mr Horan said, and comprised the Department of Finance, the Central Bank and the regulator's office. At the February meeting, attendees included Mr. Horan said, Patrick Neary (chief executive at the regulator's office), Kevin Cardiff of the Department of Finance and John Hurley of the Central Bank. The minutes recorded that work was being undertaken "in regard to establishing exposures of the Quinn Group to banks in Ireland and the impact of any disorderly unwinding of major CFD positions." The meeting also addressed some of the broader implications "that could arise should the Quinn Group experience serious financial difficulties and the ramifactions in the market should be current position become publicly known." The minutes added:"It was agreed that confidentiality was very important."

    "End of February 2008" The Domestic Standing Group was first told that Sean Quinn had build up a large shareholding in Anglo Irish. http://www.independent.ie/business/i...-29365528.html

    According to Lyons in that article, the first meeting of the DSG had been called to discuss the Quinn position.


    28th February 2008 (Source: Anglo Trial Feb 2014) From the Irish Times 12 March
    During a meeting with senior officials at the regulator on February 28th, 2008, according to minutes read out, Mr Quinn said he had been “greedy” with regard to his involvement with CFDs and needed to be “reined in”. The court heard Anglo had lent Mr Quinn nearly €2 billion between November 2007 and July 2008 to fund the margin calls on his CFD holdings.

    This Department of Finance document, hand-dated February 28th 08 and marked "Confidential" is a thorough-going review of the steps that Government can and should take in the event of illiquidity or insolvency of one or more Irish bank.
    http://www.politicalworld.org/showth...l+Lynch+Report

    March 17th "Saint Patrick's Day massacre - international crash, but Irish banks hit very hard - http://www.bloomberg.com/news/2014-0...jury-told.html

    March 2008 - Bear Stearns rescue

    March 2008 - Domestic Stability Group notes European / International funds won't invest in Irish banks - US cooling off them. Does not appear to query why European funds won't invest in Irish banks.

    March 2008 AIG back to back loans involving 1.2 billion euro

    March 2008 RBS interbank loan
    Anglo Irish claims to have engaged in back to back loans to/from Merrill Lynch shortly before Merrill Lynch went bust in 2008, before they took on the Bank Guarantee job on, just a little on the iffy side ?

    Other Anglo management e-mails, seen by RTÉ News, comment on the back-to-back funding in March 2008 which provided liquidity to Irish Life and Permanent.
    Anglo documentation said the transaction allowed Irish Life and Permanent to 'reduce its reliance on European Central Bank repurchase funding'. It also said the deal 'acknowledged past assistance from the counterpart (Irish Life and Permanent) and to position us for future potential arrangements.'.


    13 March 2008 - The redacted Ingram article and Merrill Lynch Merill Lynch, the bust American investment bank that underwrote Irish banks to the last, had a research article by Ingram pulled in March 2008. The US investment bank, which underwrote Irish bonds, scotched a report by one analyst because it contained negative comments on the country's banks, according to the report inVanity Fair. Merrill retracted and then toned down the research note by Philip Ingram, which caused a sensation on the London markets when it was published in March 2008. Merrill Lynch were subsequently to report to the Irish Government in September 2008, in a report for which they were paid €7 million, that "All of the Irish banks are profitable and well capitalised." Merrill Lynch was also involved in back to back loans with Irish banks.

    But the Vanity Fair article, ..., claims: "It would have been difficult for Merrill Lynch's investment bankers not to know, at some level, that in a reckless market the Irish banks had acted with a recklessness all their own." Note that Ingram's report on the Irish banks was published on March 13, 2008 and only four days before the St. Patrick's Day massacre of Anglo shares. According to Lewis he 'simply quoted verbatim what British market insiders had told him about various bank's lending to commercial real estate'
    Were insiders shorting Anglo?
    http://www.politicalworld.org/archiv...hp/t-6808.html

    From Politicalworld.org - Michael Lewis on How Merrill Lynch and Brian Lenihan Stuck the People of Ireland with a Debt of €106 Billion http://www.vanityfair.com/online/dai...tml#entry-more

    “This is the only Phil Ingram "report" on Irish banks I can find so I'm assuming that this is the one the bosses at ML "redacted and softened" (30 May 2008) I'm making an exception and putting it up in full.(creative commons).
    Commercial property values could drop by 30%, says banking analyst . Irish commercial property is facing a severe drop in value of up to 30%, which would hit the country’s three specialist property lenders and have a knock-on effect on the UK market. Merrill Lynch (http://www.propertyweek.com/searchResults.aspx?searchCode=1201)’s banking analyst Philip Ingram said in a note this week that the Irish commercial property market faced several pressures that could bring about a correction in prices similar to that seen in the UK. Like the UK, Ireland has also seen a sharp fall in property yields because of overvaluation and the availability of cheap debt. ‘UK capital values have dropped by over 15% to date, but Irish values have only fallen by 3%, despite our belief that Irish commercial real estate is overvalued,’ said Ingram.
    ‘There are three reasons why we think Irish capital values are only just beginning to correct. Most importantly in our view, are ownership differences. The Irish market is dominated by private investors who are not required to mark to market and may not need to, or are reluctant to, realise losses.’ The biggest risk, Ingram said, was that 37% of commercial property debt outstanding at December 2007 needed to be refinanced in 2008 and 2009, which would be difficult given the credit crunch. ‘Refinancing on economic terms is likely to become harder for some borrowers and this may cause them to sell, giving reference points for valuers to rebase valuations,’ Ingram added. He said the Irish market was hard to analyse because of the lack of standardised data, the limited disclosure requirements, the complexity of risk and historically very low impairments. The risks to the property market mean there is increased downside risk for the three Irish lenders most exposed to the market: Anglo Irish, Allied Irish and Bank of Ireland. They have all been significant lenders to UK property over the last few years. Anglo Irish has a UK commercial property loan book of £17.2bn, said Ingram, while Bank of Ireland and Allied Irish have loan books of £14.8bn and £8bn respectively.” http://www.propertyweek.com/news/mer...#ixzz1CjoSH1l7 propertyweek.com Under Creative Commons License: Attribution (http://creativecommons.org/licenses/by/3.0)

    March 15th 2008 - Sean Fitzpatrick says (ST 9.1.11) that he rang Cowen (M o F) in Vietnam (close to St Patricks Day) and told him that "there was an issue with bank shares held by Sean Quinn" - advised to ring by Fintan Drury (close friend of Cowen, Director of Anglo Irish). Vincent Browne commenting in the IT on the latest revelations:- The Monday night statement also referred to a phone call which Cowen took from FitzPatrick shortly after March 17th, 2008. The statement said: “This phone call related to concerns Mr FitzPatrick had about the market situation in relation to the bank’s shares”, and this had to do with Quinn’s involvement with Anglo, and his gamble on contracts for difference.

    Con Horan said that after Patrick's Day 2008, when Anglo's share price fell and there was a "mini-run" on the bank, was "a difficult situation for us to find ourselves in." There was ongoing engagement with Anglo after that"

    "The dogs in the street knew about Anglo"

    13 March 2008: Financial Regulator/Central Bank asked IL&P to "don the green jersey"
    http://www.publicinquiry.eu/2011/02/03/bowlers-view/

    THE Department of Finance last night denied it had any knowledge of a controversial €7.45bn transaction between Irish Life & Permanent and Anglo Irish Bank. But Taoiseach Brian Cowen and Finance Minister Brian Lenihan are being asked why they didn't investigate the deposits, which propped up the bank's balance sheet. In 2008, Anglo presented loans from IL&P as customer deposits.
    http://www.independent.ie/national-n...o-2212421.html

    Shortly after March 17th 2008 - Brian Cowen says he was informed about Anglo Irish / Quinn problems by the Governor of the Central Bank (statement 10/1/11)

    Vincent Browne commenting in the IT on the latest revelations:- The Monday night statement also referred to a phone call which Cowen took from FitzPatrick shortly after March 17th, 2008. The statement said: “This phone call related to concerns Mr FitzPatrick had about the market situation in relation to the bank’s shares”, and this had to do with Quinn’s involvement with Anglo, and his gamble on contracts for difference.
    The statement said that prior to taking the phone call from FitzPatrick, Cowen had spoken to the governor of the Central Bank. Cowen was therefore appraised of the issue. The statement said he told FitzPatrick he would refer the matter to the governor of the Central Bank and the Financial Regulator, and did so. As a consequence, a meeting was held on Good Friday, March 21st, 2008, between Anglo, the governor and the regulator.

    But what was the point of the phone conversation? What was FitzPatrick looking for? What was it that Cowen referred to the governor and the regulator? That is a curiosity. But of consequence is what subsequently occurred: a golden circle was assembled to purchase secretly Quinn’s Anglo shares (or the shares to which he was committed to purchasing), thereby forestalling a further collapse of the share price. That transaction could have been illegal, and has been the subject of Garda inquiries.
    Is it plausible Cowen did not inquire further about what had happened and, on inquiring, find out what was done was probably illegal?


    http://www.irishtimes.com/newspaper/...287328120.html
    http://www.irishtimes.com/newspaper/...287328120.html
    Graph http://2.bp.blogspot.com/_2TONRBOd21...lo+peers+1.jpg
    http://www.politicalworld.org/showth...Irish+Timeline
    http://www.theaustralian.com.au/busi...-1225998513509


    March 21st 2008 "Con Horan said that he became aware of the Quinn CFD position on Good Friday (March 21st 2008), when the chief executive of the regulator's office, Patrick Neary, briefed him on a meeting he had with Anglo. "It was a threat to the stability of the system.


    21st March - Meeting of the Regulator, Central Bank and Anglo Irish at the Central Bank re Quinn at Cowen's behest. (Source: Cowen)

    March 2008Regulator wanted banks to assist each other. Regulator positively disposed – discussions held with Regulator and Central Bank – end in court. Kevin Murphy 8.22. RTE Morning Ireland. Today

    27th March 2008 Drumm, Sean FitzPatrick, the bank’s chairman, and Willie McAteer, its finance director, met Pat Neary, then the Financial Regulator, and Con Horan, prudential director at the regulator’s office, to discuss Quinn and the Maple 10.(source: ST).

    31th March 2008 Anglo told the Regulator that the share placing was to ensure “the market price of the company’s shares will not be destabilised”.(ST)
    http://www.timesonline.co.uk/tol/new...cle7069681.ece

    David Drumm, the former Anglo Irish Bank chief executive, sent an email to a colleague in the bank saying that the controversial €500m Maple 10 share placement had been “squared” with the Financial Regulator. The same transaction, whereby the bank advanced loans to 10 clients to purchase a 10% stake in the bank, is currently the focus of a garda and Office of the Director of Corporate Enforcement investigation. A colleague of Drumm’s, Matt Moran, the chief financial officer, also sent an email saying: “Project Maple — regulator conversation done and went fine.”The Financial Regulator later claimed that it did not know of the terms of what it called a “sweetheart” deal. It remains unclear how it could have allowed the deal to go ahead if it did not know all the aspects of it.

    31st March 2008, Anglo forwarded to the Regulator a “memorandum of agreement” between it and the Quinn Group, on a plan to reduce Quinn’s holding. The terms of the agreement would be kept “confidential” from other shareholders in the bank.
    Last edited by C. Flower; 12-03-2014 at 12:29 AM.

  10. #10
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    Default Re: Anglo Irish and Banking Crisis Timeline - Some Very Dubious Behind the Scenes Bank Support


    In April, the Domestic Standing Group was involved in contingency planning for both liquidity and solvency crisis in an Irish bank.

    8th April 2008 -
    Tuesday
    08/04/2008
    Department’s Powerpoint presentation re Contingency Planning for DSG meeting 17 April 2008
    Department to get more involved if solvency an issue - "present a fait accompli" "avoid contagion" "confidence"

    "Open ended State guarantees exposing the Exchanquer to the signifcant fiscal risk are not regarded as part of the toolkit for successful crisis management and resolution.
    There are circumstances where such guarantees may be unavoidable to maintain confidence in the overall financial system"

    http://www.oireachtas.ie/documents/c...document35.pdf

    10th April 2008
    3.00 p.m. Meeting between D o F and NTMA officials to discuss contingency steps - http://www.oireachtas.ie/documents/c...document34.pdf

    24th April 2008: 17:43 Email from Ciara Lonergan to Michael Manley : reply to query on how legislation could be changed so that the Minister could give a banks guarantee. It was advised that new legislation would have to be passed.

    http://www.oireachtas.ie/documents/c...document33.pdf

    24th April 2008 -
    Tuesday
    29/04/2008
    Consultation paper from Department to the Office of the Attorney General re preparation of a draft nationalisation Bill Part redacted

    24th April 2008 - “David Drumm says that at a dinner with members of the board of Anglo Irish Bank in April 2008 Brian Cowen was asked if he had any information concerning what was obviously a previous request from Anglo: to get the NTMA to deposit cash with the bank. According to Mr Drumm, Brian Cowen responded with a familiar epithet that conveyed annoyance with the NTMA's refusal to comply with the request.” Irish Daily Mail Interview with Drumm Jan 2011.

    24th April 2008 - Brian Cowen's private dinner with Directors of Anglo Irish Bank. IDM Source says "He (Cowen) was acutely aware of our problems" 'David did ask about the NTMA,' Fitzpatrick recalls...'Anglo wanted [Cowen] to have a word about it placing some of its money on deposit with the bank. He said he'd look into it.'
    “Now skip forward a few weeks for this event - DoF meets NTMA:” (Fitzpatrick Tapes)
    From Gavinsblog: We have also since learned that the meeting between Brian Cowen and Anglo Directors on April 24th (according to an FG spokesman and not denied) was on the same day as the meeting between Anglo “cronies” to organize a share support operation. What a coincidence. Brian Cowen and Anglo directors on April 24 http://www.gavinsblog.com/2009/03/04...ross-responds/

    April 2008 Emergency training was provided for the Regulator, Neary, in case of financial collapse https://pbs.twimg.com/media/BDniA8zCIAIUX6E.jpg:large

    29th April 2008 - Advice from the Attorney General on a draft nationalisation Bill.
    http://www.oireachtas.ie/documents/c...document32.pdf

    29th April 2008 - Brian Cowen appoints Brian Hillery (FF, ex Unicredit Bank Chair) and Dermot O'Brien, ex Chief Economist NCB Stockbrokers, ex Central Bank, as Directors of the Central Bank and FSAI.

    http://www.finance.gov.ie/viewdoc.asp?DocID=5278

    1st May 2008 Financial Regulator meet IL&P to develop the "green jersey" agenda in more detail. (Sunday Times)http://www.timesonline.co.uk/tol/new...ffset=0&page=1

    2nd May 2008 Over the week (to 02/05) Anglo Irish Bank is the best performer on the ISEQ (up 15% to €9). “Irish financials together with international banking indices are buoyed by improved investor sentiment on the growing belief that the worst of the credit crisis is over. In addition, providing some extra support to Anglo is a report in the Sunday Independent that a group of Anglo Irish Bank clients plan to set up a fund to buy shares in the troubled bank.”

    Throughout the first half of 2008, a precipitous fall in Irish Bank share prices and numerous downgrading took place, with a great deal of international banking crisis and angst running alongside. ECB liquidity repeatedly issued.

    http://www.bankinginquiry.gov.ie/The%20Irish%20Banking%20Crisis%20Regulatory%20and% 20Financial%20Stability%20Policy%202003-2008.pdf


    8th May 2008 - Briefing note to new Minister for Finance, Brian Lenihan, on bank stability / risk issues

    http://www.oireachtas.ie/documents/c...document31.pdf

    May 2008 – Hushed up 200m loan from Hypo to Anglo Irish “dressed up” as customer deposits - http://www.independent.ie/business/i...-26651712.html
    Internal Anglo Irish Bank documentation reveals executives believed that the Central Bank and Financial Regulator were 'positively disposed' to back-to-back loans worth €7.45 billion provided by Irish Life and Permanent. The report also shows that Anglo entered reciprocal deals with Merrill Lynch, Royal Bank of Scotland, AIG and Hypo Real Estate.http://www.rte.ie/news/business/2010/0618/132364-anglo/

    7th May 2008: Anglo Irish Bank chief executive David Drumm states the bank is in a "robust funding position."

    7th May 2008 Briefing Note to Minister for Finance - Provided to KC(Kevin Cardiff) - forwarded by William Beausang to Michael Manley.

    http://www.oireachtas.ie/documents/committees30thdail/pac/reports/documentsregruarantee/document31.pdf


    May 2008 : Back to back loans with Hypo Real Estate

    13th May 2008 Brian Cowen becomes Taoiseach and passes the Department of Finance to Brian Lenihan. He goes on a three month “royal progress” around his constituency, followed by a caravan holiday in August.



    16th May 2008 Beausang and Cardiff receive Attorney General's heavily redacted (why??) advice on State Aid and EU law.
    http://www.oireachtas.ie/documents/c...document30.pdf

    21st May 2008
    DoF officials met with Michael Somers, chief executive of the NTMA. The meeting records: 'The NTMA has placed some deposits with the main banks.' Somers did not want to deposit funds with Anglo Irish. This is also mentioned in the Independent: Briefing note to Minister - http://www.oireachtas.ie/documents/c...document29.pdf Mr Somers refers to this "strictly confidential" document.

    May 21th, 2008, Dr Michael Somers, head of the NTMA, found himself being further sucked into the government’s attempts to deal with an embryonic crisis.

    “Headstrong, independent and often contrary (aka prudent and legal – C.F.), Dr Somers was meeting the new Finance Minister, Brian Lenihan. Dr Somers was given an uncompromising message: the NTMA simply must help the banks, by providing them with liquidity and deposits. The reason help was needed was to offset the sheer scale of help the ECB was already giving the banks.” http://www.independent.ie/business/i...n-2262833.html

    May 2008 Neary allegedly told Casey at a meeting that the NTMA, the Dept of Finance, and Lenihan all needed to be able to show they had 'clean hands' if deposits were increased. (This may refer to EU regulations that a State fund may invest in viable banks, but not prop up a bankrupt one – Note by CF) The NTMA had twice previously refused to increase deposits with IL&P. After the financial institution followed Neary's advice and appointed BNP Paribas, to make a formal presentation on its behalf, the NTMA lodged 250m. (ST)
    Last edited by C. Flower; 04-08-2013 at 06:57 PM.
    “ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
    — Jean-Paul Sartre

  11. #11
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    Default Re: Anglo Irish and Banking Crisis Timeline - the Crash Gets Crashier - Summer of 2008


    1st June 2008
    Memorandum of Understanding on Cooperation between Financial Supervisory Authorities, Central Banks and Finance Ministries of the European Union on Cross Border Financial Stability - framework for assessing crisis and reporting emergencies between States. http://www.ecb.int/pub/pdf/other/mou...lity2008en.pdf

    June 2008 “Brian Lenihan issued a directive to the NTMA to increase deposits to IL&P and EBS “In June 2008, a direction was issued by minister Lenihan for the NTMA to increase IL&P deposits to €250 million and EBS deposits to €100 million subject to the provision of the appropriate collateral and a commercial return.” From the print edition of the Sunday Times 16/1/2011 by John Moloney: No online link as its behind a paywall:

    3rd June 2008

    An application to Anglo’s credit committee dated June 3rd 2008 , stated Sean Quinn had requested the bank to provide €140 million funding. That document continued: “This is to be used to fund cash calls relating to the recent fall in the Anglo share price”, she said.

    http://www.irishtimes.com/news/ireland/irish-news/regulators-conspired-with-anglo-to-prop-up-share-price-1.1466343?page=1


    6th June 2008 Draft Heads of Bill for Contingency Legislation secretly prepared by the Department of Finance - Contingency for nationalisation or guarantee.
    http://www.oireachtas.ie/documents/c...document28.pdf

    12th June 2008 Draft legislation for allowing the Central Bank to acquire shares in a bank. Michael Manley to David Doyle, cc Kevin Cardiff. Part redacted.
    http://www.oireachtas.ie/documents/c...document27.pdf

    19th June 2008 Letter from Michael Manley to Jonathan Buttimore (solicitor?) - Our policy approach is to have legal powers available to the Minister to take an individual financial institution into public ownership in certain circumstances rather than as is the case in the UK to create a broad policy framework to support the resolution of financial stability issues as they may arise across the banking sector as a whole.

    28th June 2008 - Fintan Drury, "close friend and advisor" to Brian Cowen, resigned from his Directorship of Anglo Irish Bank.

    30 June 2008: Anglo Irish deposited €3.45 billion temporary funds with IL&P, to assist IL&P's funding challenges.(ST)

    July 2008, directions were issued to the NTMA by the Government relating to the roll-over of the existing deposits in AIB, BoI and Anglo Irish Bank - where €40million had been invested a year earlier. http://www.thepost.ie/news/governmen...-08-54093.html

    July 2nd 2008: William Beausang of the Department of Finance (working with Kevin Cardiff on banking) met with Brian Cowen.

    July "Department on the phone every day wanting to know of the placements (of Quinn shares) had been made"... (O'Connor report, Anglo Irish)

    July 8th "Senior Civil Servants met with the Financial Regulator to discuss Quinn" - http://www.independent.ie/business/i...-29365528.html

    July 9th 2008 Con Horan says he got a call from David Drumm, Anglo CEO, who told him it was decided to "unwind Quinn's position" by selling the shares to family members and "Irish and international investors" "Con Horan said it was his understanding that Anglo would initially put up the money to buy the totality of the shares, worth around €938 million. On the same day the new investors would come in and buy €445 million in shares and the balance would be bought by Credit Suisse, who he understood were financing the Quinn family members' purchases." Mr. Horan said he asked Mr. Drumm if any financing was being provided to the non-Quinn investors. Mr. Drumm replied that in the event of any of those investors having "cash flow issues", Anglo would provide them with assistance "for a very short period of time" Mr. Horan said he understood this meant "a matter of days". Because of a delay in the Quinn children receiving money from Credit Suisse, Mr. Horgan said he understood that Anglo were going to provide €169 million to the Quinns for a period of two to three weeks. Asked how he believed the non-Quinn investors were funding the purchase, he said : "These were high net worth individuals, and that was coming from their own resources."

    http://www.politicalworld.org/showth...533#post346533

    July 12th 2008 Con Horan, prudential director at the Regulator's office, said he took a conference call with Morgan Stanley on the proposed sale of part of Quinn's CFD Anglo share holding. The shares were to be sold to 16 people including some members of the Quinn family. Employees of the investment bank outlined the transaction to him, and the information he received "seemed very consistent with what Mr. Drumm had said to me."

    Mr. Horan said he asked Morgan Stanley if they needed any approvals from the regulator and they said no. "I said, based on what I was told, I didn't have objections."
    He said he told them that it was up to Morgan Stanley and Anglo to ensure the deal complied with regulatory requirements. Asked whether lending to the investors was mentioned, Mr. Horan said "I have no recollection of any of that"


    July 12th -13th - 2008: “Maple 10” 10% of Anglo Irish Bank is placed with 10 of its clients in a move not disclosed to the Irish Stock Exchange. http://www.timesonline.co.uk/tol/new...ffset=0&page=1

    14th July 2008 The transaction took place.

    July 15, 2008: Sean Quinn states his family controls 15% of Anglo Irish Bank http://www.timesonline.co.uk/tol/new...ffset=0&page=1
    “In July 2008 Quinn converted investments in the bank to ordinary shares, increasing his family's stake to 15%.” (Wikipedia Anglo Irish Bank)

    July 2008 – “After several years of successfully offering Corporate Treasury services to clients from its HQ in Dublin, Anglo Irish Bank decided to establish a presence in the German market. In July 2008, the Anglo Irish Bank Branch in Düsseldorf was officially opened for business.” http://www.irishbusinessnetwork.de/?p=405

    July 23rd 2008 "Senior Civil Servants met with the Regulator to discuss Quinn" - http://www.independent.ie/business/i...-29365528.html

    24th July 2008 Con Horan, Prudential Director of the Regulator, approved a €169 million loan to Quinn to purchase shares in Anglo Irish Bank in spite of the fact that such purchases are "usually illegal." http://www.irishtimes.com/newspaper/...275694619.html
    According to the front page of today's SBP, approx. €160 million in loans from Anglo Irish to Quinn, for the purpose of buying Anglo share CFD share options, was not used for that purpose and can't be accounted for.

    This is from two separate reports for the current Quinn group by Kroll and Ernst and Young.
    http://www.politicalworld.org/showth...609#post255609

    http://www.finfacts.ie/irishfinancen..._1020257.shtml

    26th July 2008: “Sean Quinn wrote to David Drumm (two days before the golf game) and complained bitterly about his treatment at the hands of Anglo. I've posted it on the Quinn thread but here are the details:
    “Mr Quinn raised concerns with Anglo chief executive David Drumm in a letter shortly after the bank completed the transaction aimed at supporting Anglo’s beleaguered share price at a critical time in the growing banking crisis. The letter, seen by The Irish Times, reveals the tension between Mr Quinn and Anglo over the transaction, which the Garda Bureau of Fraud Investigation and the Office of the Director of Corporate Enforcement are investigating.”
    “I am writing this letter to you personally without the benefit of advice from my colleagues or legal advice,” Mr Quinn told Mr Drumm in the letter dated July 26th, 2008 and marked “private and confidential”. “I strongly believe that the actions of the bank were ill advised and will have a considerable impact on our wider group for many years,” he added.
    IT: http://www.irishtimes.com/newspaper/...277688678.html
    http://www.politicalworld.org/archiv...p/t-12355.html

    28th July 2008 Sean Fitzpatrick, Fintan Drury (BC's friend and until previous month and member of Anglo Irish Board) and Brian Cowen played golf and had "unscheduled dinner" at Druid's Glen. Meeting later attended by McCann (Anglo Irish) and Gray (Indecon) (ST 9.1.11).

    23rd July 2008 Domestic Group on Financial Stability meets: These notes reveal knowledge of vulnerability of banks and flight of capital. A group of officials in the Department of Finance, the Central Bank and the Financial Regulator discussed the stability of Anglo Irish and other financial institutions in the months prior to the bank guarantee scheme being put in place in September 2008. http://www.oireachtas.ie/documents/c...document16.pdf

    August 2008 Cowen goes to his caravan for the summer. http://www.irishtimes.com/newspaper/...287488231.html
    Cowen stood down all the professional advisers from Cabinet meetings summer 2008, just when they were needed. After the summer, the DSG was extended into an ad hoc group of politicians and civil servants that ultimately made the decision on the Guarantee. The Cabinet was not called together to discuss the Guarantee. No notes were taken of the meeting that agreed the Guarantee.

    July – September 2008 “Former Fianna Fail general secretary Pat Farrell could find his way around the corridors of power in his sleep. He's also the chief executive of the Irish Banking Federation, the main lobby group for the banks. And he's been in a lot. Especially as things started to go brown. In July 2008, as bank shares cratered after the meltdown at Bear Stearns and Britain's nationalisation of Northern Rock, Doyle and his boss, Finance Minister Brian Lenihan, were pencilled in for a dinner with Farrell.

    Doyle's diary noted that the minister was to meet AIB's then chief executive, Eugene Sheehy, and his counterpart at Bank of Ireland, Brian Goggin, at the start of September 2008 as things got critical.

    September 4th 2008 - Sept 4th Lenihan's Diary - 11:00 AM 11:00 AM MEETING WITH BRIAN GOGGIN, CEO BOI & MR SHEEHY, CEO AIB. VENUE:

    September 2008 There were a series of transactions by Anglo Irish late in 2008 that don’t immediately make a lot of sense

    5th September 2008
    http://thestory.ie/2010/04/26/a2008 - In September, Anglo Irish sells Anglo Irish Bank Austria (AIBA) to Swiss bank: Valartis Bank A.G. Lends the Bank 24 million towards the purchase. http://www.politicalworld.org/showth...758#post113758 http://en.wikipedia.org/wiki/Anglo_Irish_Bank

    “Looks like Anglo went on a disposal spree in the months running up to the news that it was a dog operation; 'The Austrian private bank contributed 1% of Anglo’s pre-tax profits and had net assets of €76 million. This sale, which will be accretive to Anglo’s capital base, follows the successful disposal of Anglo’s Isle of Man trust operations in 2006 and of its Swiss private bank earlier this year.” http://www.angloirishbank.com/Media-...ubsidiary.html

    'Separately, we are retaining our long established Austrian branch and will further invest in its significant deposit gathering and wider treasury activities (Drumm). Anglo Irish opened a new branch in Dusseldorf in 2008.

    September 2008: Numerous conversations between FR Anglo and IL&P regarding the outflow of money from the system. 6 billion Euro of deposits left Anglo in these weeks.

    5th September 2008
    8.16 The publication of a very adverse rating agency report on INBS on 5 September 2008 heralded the final stage of the run-up to the guarantee. More frequent and higher level meetings between the agencies represented in the DSG (with the NTMA), took place imbued with a growing sense of urgency. Department of Finance took a clear leading role at this stage (with the CBFSAI playing a less central role than might have been expected), commissioning consultants and advancing preparations for legislation to nationalise a bank and/or a building society and to provide an extensive guarantee of banking liabilities. The diminishing access of banks to liquidity was now an urgent focus of attention. While the INBS story had heightened concern, it was generally understood that it was Anglo Irish Bank that was most vulnerable on a week-to-week basis, depending in particular on how much of its maturing deposits would be rolled over. Consultants were engaged to scrutinise the condition of INBS and Anglo.

    As the discussions regarding procedures for crisis containment started to unfold, early on a clear consensus view emerged that no Irish bank should be allowed to fail in the ]sense of having to close its doors and not repaying depositors and other lenders. This strong view departed from the textbook view that only systemically important institutions should be candidates for such protective treatment. (See below for a further discussion of systemic importance.) But it was shared without reservation by all the [FONT=Times New Roman]facing imminent underlying solvency risks.
    Last edited by C. Flower; 08-05-2015 at 08:59 PM.
    “ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
    — Jean-Paul Sartre

  12. #12
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    Default Re: Anglo Irish and Banking Crisis Timeline - World Liquidity Crunch - The Tide Goes Out from the Irish Banks



    6th
    September 2008, Lenihan and David McWilliams on TV. Lenihan accuses McWilliams of “dangerous talk” for saying Irish banks were in danger of going bust.

    6th September 2008 - 7th September - Meetings between the Regulator and BoI (other banks?) about bailing out INBS / about liquidity crunch -
    "I would say that weekend was a weekend when, on a personal basis, I realised the extent of the issues in the system were very, very serious. I was ... I believe ... I can't remember exactly ... our chief executive got a phone call from the Central Bank asking if we could provide ... if we could have people available to the meeting ... to a series of meetings to discuss support for Irish Nation ... sorry ... a building society and the chief executive asked myself and ... obviously because I was at retail in Ireland and had experience ... and also a colleague of mine who was head of our wholesale division and would've had a good understanding of treasury markets, etc. Prior to the meeting, I asked my chief executive whether we were provided with any information to help us analyse the problem before we went to the meeting. I went to the meeting ... it was primarily ... the meetings primarily took place on the Sunday of the 7th." Richie Boucher Banks Inquiry transcript 2015


    8th September 2008 : Lenihan's Diary :00 PM 03:00 PM MEETING WITH SEC GEN AND KEVIN CARDIFF

    8th September 2008 - US Embassy wikileak on Ireland's economic slippery slope.

    http://www.cablegatesearch.net/cable...diff%20ireland

    Sept. 9th 2008 - Gray met Lenihan at 11.30 in the Department of Finance.

    Sept 11th 2008 "The Anglo Board first realised that the bank was massively threatened by Quinn's "gambling on its share price" (contract for difference) (IDM)

    Fri Sept 12th Lenihan's Diary INFORMAL ECOFIN - EUROGROUP 09:00 AM 12:00 PM EUROGROUP

    Sept. 15th 2008 Collapse of Lehmans: Anglo Irish Bank starts losing large deposits, sourced mostly from the money markets, of between €50 million and €200 million each. These total about €1 billion a day. Anglo chairman Seán FitzPatrick and chief executive David Drumm meet their counterparts at Irish Life & Permanent, Gillian Bowler and Denis Casey, to discuss a possible merger. Irish Life & Permanent turns down Anglo and instead approaches EBS about merging (Carswell). (From the Report of the Governor of the Central Bank-May 2010)

    15th September 2008 (From the Report of the Governor - Central Bank-May 2010) Former Revenue chief Frank Daly popped in two days after the collapse of Lehman Brothers on September 15. He would be appointed to the board of Anglo Irish Bank some weeks later.” (Independent Newspapers)

    17th September 2008 - Lenihan's Diary - 04:00 PM 04:45 PM MEETING WITH DR. SOMERS, NTMA Venue: Department.

    17th September 2008
    Meeting of the extended Domestic Standing Group considered guarantee of all deposits, bank mergers. http://www.politicalworld.org/showpo...8&postcount=59

    http://www.oireachtas.ie/documents/c...document17.pdf

    The minutes list "Action points for the Review" at a meeting of 17 September.

    The first item is "Brief ECB on serious funding difficulties now arising (in the Irish banks) and euro wide systemic impact" That would suggest to me that the group was aware of the cataclysmic scale of the situation in the Irish banks.

    Most of the other points are about finding emergency loans for the bank and about trying to establish their financial positions at different time points (bonds due etc ?)

    The note then says

    9. Examine potential for underpinning stability of the Irish banks through Ministerial Statement;
    1. On increase in limit and aboliition of Co-Insurance element of Deposit Guarantee Scheme.
    2. Stability and robustness of Irish Banks (asking him to lie ?)
    3. State guarantee for all deposits.

    The note clearly views two Irish banks as being capable of receiving and circulating liquidity through the system - by implication they considered Anglo Irish incapable and banjaxed.
    Mergers were also to be discussed "to seek to ability their funding position (sic)".

    The proposal for a Guarantee for all deposits already went way beyond anything going on in Britain or elsewhere, where deposit guarantees were of the 20,000-£100,000 mark at different stages.

    Sept 17 2008: David Drumm and Wilie McAteer (Anglo Irish) met the Regulator to discuss the critical funding position.
    The haemorrhaging of deposits means Anglo has breached its regulatory liquidity ratios. The bank asks the regulator for a special line of liquidity in case more deposits are lost. Anglo proposes using some of its €73 billion loan book as collateral to draw emergency funding from the Central Bank of Ireland (Carswell, IT).

    17th September 2008 The day AIG went bust -- McWilliams appeared on 'Prime Time'.
    He again warned that the banks were bust and again the establishment -- this time in the guise of the head of the Irish Banking Federation -- accused him of "loose talk". That evening, Lenihan called to David McWilliams’ house where a banks guarantee was discussed.
    http://www.independent.ie/entertainm...-26577796.html

    September 18th 2008 – Lenihan had a meeting with Sean Fitzpatrick http://www.gavinsblog.com/category/i...n/anglo-irish/ The meeting was not in his diary.
    "Anglo chairman Seán FitzPatrick meets Lenihan and proposes Anglo take over Irish Nationwide with Government support. The Minister dismisses the idea. Later, Government and regulatory officials meet Brian Lenihan to discuss the “great strain” on the liquidity of the banks. They decide to increase the State deposit guarantee scheme from €20,000 to €100,000. Central Bank governor John Hurley suggests a €10 billion emergency fund and the possibility of nationalising or supporting Anglo."(Carswell, IT)

    18th Sept 2008 - €50 million went to An Post from the Banks within a few hours of a Liveline programme featuring public worries about the banks' stability. Lenihan rang Cahal Goan to complain that RTE was causing a run on the banks. http://www.independent.ie/business/i...-26478869.html

    Lenihan's Diary - Friday (Thursday?)18th 03:30 PM 04:00 PM MEETING WITH DR. MICHAEL SOMERS, NTMA & PAUL CARTY, NPRF.
    It was decided to increase the deposit guarantee scheme from €10,000 - €100,000. John Hurley, Central Bank CEO, recommended a €10 billion "liquidity fund" immediately and "look how to deal with the broader issues over the next week or so" - No mention in notes of applying the CB Contingency Plan (Red or Black Book).

    Thursday 18/09/2008 Transcript of handwritten note of meeting of Minister, Department, NTMA, Central Bank and Financial Regulator 18 September 2008 Part redacted

    04:30 PM 05:00 PM MEETING WITH PHILIP LANE. VENUE
    DEPT (of Finance)

    September 18th 2008 “Tony Garry, the chief executive of Davy, the country's most influential stockbrokers, whose clients included Anglo Irish Bank, met with David Doyle, the head of the Department of Finance, three days after Lehman Brothers had collapsed and 11 days before the State guarantee. He discussed with Mr Doyle the financial crisis and what needed to be done to solve it. However, what he said exactly is not known and he declined to comment (Independent, April 2012) http://www.independent.ie/irish-news...-26848122.html

    18th September 2008 - leaked phone conversation between Bowe and Fitzgerald on how Anglo Irish was trying to get the Government on the hook for 7 billion to secure its commitment to saving / bailing out Anglo Irish.
    Mr Bowe is asked by Mr Fitzgerald how they had come up with the figure of €7bn. He laughs as he is taped saying: "Just, as Drummer (then-CEO David Drumm) would say, 'picked it out of my arse'."
    Once this public money was paid over, Anglo Irish believed more would follow. There was no question of ever paying the €7 billion back.
    http://www.independent.ie/business/i...-29366837.html

    Sept 19th 2008 Anglo Irish Bank makes a presentation to the Department of Finance, saying it will be “highly profitable” in 2009, with bad debts of just €300 million. Officials from the department greet Anglo’s soundings sceptically. Kevin Cardiff, in evidence to the PAC, says that he attended, he does not remember who else was there, and that he took no notes. (Carswell, IT)
    Last edited by C. Flower; 08-05-2015 at 09:05 PM.
    “ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
    — Jean-Paul Sartre

  13. #13
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    Default Re: Anglo Irish and Banking Crisis Timeline - the Scramble for the Life Boats - Women and Children Last



    20th September 2008

    The Regulator meets the banks and building societies in sequence to gather further intelligence on how much they are losing in deposits, and their views on potential mergers. They are told the Government will announce the increase on the deposit guarantee that day, and that the announcement will contain “generous wording” signalling that the Government stands behind the banking system. Later that day, the Government says publicly that it wants to “protect the whole financial system, secure its stability and ensure that all deposits in Irish financial institutions are safe”. “The statement contained what officials called ‘constructive ambiguity’,” recalls an insider. “It was never quite clear what the Government was saying, but it was so ambiguous it could be seen constructively by the market.”
    (Carswell, IT).

    21st September 2008 (Sunday)
    Goldman Sachs, advisers to Irish Nationwide, tells Government officials the building society is in danger of running out of funds in 11 days. Peter Sutherland /Goldman Sachs becomes involved at advising the Government, billed to Irish Nationwide. Goldman Sachs were listed at a later date as bondholders.

    21st September 2008 McWilliams calls for a deposit guarantee.

    http://www.davidmcwilliams.ie/2008/0...as-a-safeguard

    http://www.irishexaminer.com/ireland...ng-104615.html

    22nd September 2008 Mergers and liquidity borrowing from the Central Bank discussed. The issue of how much the CB held came up (1% of Bank Deposits?).

    Mr Kevin Cardiff: Document No. 6 shows that officials from the Department, the Financial Regulator and the Central Bank were asking the question about whether the figures on these loss exposures were capable of being sustained if things got a lot worse than they were at that stage. Chairman: So there was an issue of solvency at that meeting of 22 September. Mr Kevin Cardiff: There was certainly an acknowledgment of a danger, assuming things went badly wrong, that there could be-----
    Chairman: That is why I referred to Mr. Doyle’s comments about a possible €8.5 billion for Anglo Irish Bank and €2 billion for Irish Nationwide Building Society.
    Mr Kevin Cardiff: There is no one taking-----
    Chairman: These were potential loss exposures.

    ( Re: Public Accounts Committee - 2008 Report of the C & AG - Department of Finance Grilled (Politicalworld.org thread))
    24th September 2008 Merrill Lynch, a US bank/financial institution involved deeply with Irish Banking and itself bust and taken over by a larger bank, was appointed as Government advisors on the banks crisis. In the main, advice was being provided in house by Department of Finance generalists without banking expertise. Merrill Lynch allocated a staff member based on London to the project.

    24th September2008, there was a meeting, chaired by Cowen, between officials from the Central Bank, the Department of Finance and the NTMA. The talk was of the possibly of nationalising Anglo.

    25th September 2008 Ireland becomes the first country in the eurozone to declare it is in a "recession".
    http://www.timesonline.co.uk/tol/new...ffset=0&page=1

    25th September 2008

    "The week ahead of the government guarantee of September 30, 2008, was unremarkable according to Doyle's (top civil servant in the Department of Finance) diary -- though one appointment after 4pm on Thursday, September 25, was blacked out by the department."

    The meeting with Garry came seven days before Tiernan O'Mahony, the former head of Treasury in Anglo Irish Bank, met with Kevin Cardiff, the civil servant in charge of banking in the department, at 8.30pm. Mr O'Mahony, who had left his Anglo post at the time of the meeting, argued that some form of a bank guarantee was needed to protect Ireland's banks and the economy. Mr Cardiff has previously said this meeting was only a "listening brief" and he gave no indication as to the department's views. http://www.independent.ie/national-n...e-3095261.html

    As the banks continue to lose deposits and their shares keep falling, meetings intensify and department officials and their advisers Merrill Lynch – appointed the previous day – meet the CBFR to discuss what steps need to be taken next. Various options are discussed, as advised by Merrill Lynch: ordinary funding support, a special liquidity scheme to lend €20 billion to the banks, guarantees, nationalisation and a bad bank to take out problem loans. “At this stage, things were getting worse and worse – it was dire,” says one insider. Another recalls: “They were looking at options – the focus was exclusively on liquidity, and for the most part they had not jumped to some of the what-ifs around solvency” (Carswell).

    Neary, the Regulator, told Cowen that Anglo Irish had enough assets to cover its debt.

    http://www.rte.ie/news/2010/0716/133404-banks/

    A letter from the AGO was issued to officials in the Department of Finance to brief them on issues arising from consultations with the European Central Bank (ECB).
    http://www.independent.ie/business/i...-26668025.html

    Days before 30 September 2008: Merrill Lynch draws attention to Quinn's position. The IL&P sent 4 billion Euro to Anglo "in line with the previous discussions on the "green jersey agenda". The transaction was broken up over a number of days. back to back transfers involving 7.5 billion between ILP and Anglo took place over the last few days of September as this was the end of the reporting period.- This was the day after the Guarantee ??

    According to his evidence to the PAC, Cardiff told the Regulator about this, but not the Minister for Finance.


    26th September 2008 Merrill Lynch email – http://www.rte.ie/news/2010/0716/merrilllynch.pdf

    Merrill Lynch tells Brian Lenihan a blanket guarantee “could be a mistake” that would damage the country’s credit rating and allow “poorer banks” to continue in business. At the same time, the advisers say that the guarantee would be the “best, most decisive, most impactful” from the market’s perspective. Anglo formally requests a short-term liquidity loan of €1.7 billion from the Central Bank to tide it over the end of the month. The same day, Irish Life Permanent begins providing up to €3.45 billion in cash deposits to Anglo over the next four days (Carswell, IT).

    26th Sept 2008- Friday
    Lenihan's diary - "meeting with officials and bankers" 4.30 p.m.
    Friday 26th 04:00 PM 04:00 PM MEETING WITH OFFICIALS REGARDING BUDGET/TAX MATTERS. 04:30 PM 04:30 PM MEETING WITH OFFICIALS AND BANKERS 05:30 PM

    05:30 PM MEETING WITH C.CONNOLLY, D MC NALLY AND A NOLAN. (Department of Finance senior official, banking)

    Re: Public Accounts Committee - 2008 Report of the C & AG - Department of Finance Grilled (Politicalworld.org thread)

    “Bernard Allen just forced Kevin Cardiff into admitting they were aware of solvency issues in Anglo, contradicting Lenihan's "promise" to Noonan in the Dail that the guarantee was a simple liquidity issue.” Chairman: Did any alarm bells ring about the total reversal of the situation between 18 and 22 September? Did any questions about solvency enter into your mind? Mr Kevin Cardiff: Document No. 6 shows that officials from the Department, the Financial Regulator and the Central Bank were asking the question about whether the figures on these loss exposures were capable of being sustained if things got a lot worse than they were at that stage. Chairman: So there was an issue of solvency at that meeting of 22 September. Mr Kevin Cardiff: There was certainly an acknowledgment of a danger, assuming things went badly wrong, that there could be-----
    Chairman: That is why I referred to Mr. Doyle’s comments about a possible €8.5 billion for Anglo Irish Bank and €2 billion for Irish Nationwide Building Society.
    Mr Kevin Cardiff: There is no one taking-----
    Chairman: These were potential loss exposures.
    Mr Kevin Cardiff: There was no one saying that just because Anglo Irish Bank handed us a presentation, everything was all right. We were not relying on Anglo Irish Bank for our view of Anglo Irish Bank. We were talking to regulators and all sorts of advisers and others, so we were not relying on the bank.
    Chairman: Surely, if the guarantee was introduced on 29 September on the basis of liquidity, somebody must have been very blind on 25 September if he or she could not see from the figures that there was a question of solvency. Coupled with that, we had the absolute deceit from the Anglo Irish Bank presentation on 18 September, while on 21 September it was known there would be a possible €7 billion required to keep it running. Not only should alarm bells be ringing at that stage, the sprinkler system should have been on. It was running out of control.

    Mr Kevin Cardiff: That is what we were doing. We were-----

    Chairman: You still based your guarantee on liquidity on 29 September. That is the point I am making.

    Mr Kevin Cardiff: We based “our” guarantee - I am not supposed to comment on the decisions of Ministers - on the basis of the situation as it presented itself, including the mix of risks, the mix of potential options, and how those two interacted. I do not think it would be accurate to say that we were totally oblivious to solvency issues, or that we had a fine picture of how the solvency would come undone over time and that we therefore had perfect knowledge. We were somewhere in between those two extremes.

    The sprinkler systems had been running for several weeks at that stage. There was not a sense in which this suddenly arose on one night and nothing had been done and no discussions had taken place beforehand. As members can tell from the technical preparations, meeting notes and so on, there was a concerted effort to deal with the crisis.
    http://debates.oireachtas.ie/DDebate...Node=H3&Page=9

    http://www.politicalworld.org/showth...l+Lynch+Report

    Sept 27th 2008 (Sat) Saturday, Minister Lenihan is at a Fianna Fail fundraising event in Gowran Park in Kilkenny when he takes a call from President of the ECB, Jean-Claude Trichet, who reportedly tells Minister Lenihan to expect an urgent call from CBI Governor, John Hurley later that day. Minister Lenihan takes initiative and rings John Hurley. http://namawinelake.wordpress.com/20...-probably-not/

    Sept 27th 2008 Documents not released: Saturday 27/09/2008 Letter from Attorney General to Minister re State Aids and System Wide Bank Guarantee "Not released - the document is subject to legal privilege as it contains advice received from the Attorney"

    Saturday Letter from Office of the Attorney Document General to the Department re Financial Stability Planning - National Pensions Reserve Fund Extracts from PwC material re liquidity position.
    Comment subject to legal privilege as it contains advice received from the AGO

    Not released - institution specific information prepared by PwC for the Financial Regulator

    Not released - institution specific information prepared by PwC for the Financial Regulator Not released - institution specific information prepared by PwC for the Financial Regulator
    http://s3.documentcloud.org/document...cs-pac-all.txt
    Last edited by C. Flower; 05-08-2013 at 07:48 AM.
    “ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
    — Jean-Paul Sartre

  14. #14
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    Default Re: Anglo Irish and Banking Crisis Timeline - the Full Monty

    ...Lenihan's Official Diary

    Meetings with "bankers" on the Fri 26th, a Cabinet meeting at 10am on the Sunday, mysterious "private appointments" on the Monday...look even further back, a meeting with the (named) CEOs of AIB and BOI on Sept 4th but the Fri 26th meeting is with "bankers"...and when, exactly, was that report from Merill Lynch first commissioned? They delivered it on the 26th! Also, it appears that the night Lendahand arrived at McWilliams' door stinking of garlic was the 17th!

    The Guarantee was calmly and carefully planned over a period of weeks, not a panicked late-night emergency decision.
    Sidewinder.
    Last edited by C. Flower; 23-07-2013 at 07:36 PM.
    “ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
    — Jean-Paul Sartre

  15. #15
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    Default Re: Anglo Irish and Banking Crisis Timeline - Black Sunday



    28th
    Sept 2008 David McWilliams: “ The only option is to guarantee 100 per cent of all depositors/creditors in the Irish banking system. This guarantee does not extend to shareholders who will have to live with the losses they have suffered. However, it applies to everyone else. If the minister does this, he will not only staunch any funds outflow, he will show leadership and be seen as someone who is coming up with a solution that can be copied all over the world. Ireland in the past has done things that no other country has done, to great effect. Think of the zero tax rate on exporters in the 1970s and the 12.5 per cent tax rate on multinationals now.” http://www.davidmcwilliams.ie/2008/0...ert-depression

    28th Sept 2008 Sunday morning Minister for Finance Brian Lenihan meets with Central Bank of Ireland Governor, John Hurley at the Central Bank on Dame Street,Dublin who advises Minister Lenihan that several banks in Europe are facing crisis including Fortis and DEPFA.

    28th September 2008 “On Sunday, September 28th , at a pre-budget cabinet meeting, Cowen and Lenihan discussed the options for some sort of bank rescue with the Cabinet members. He raised the issue of a bank guarantee, which had been proposed several times in recent weeks. Reportedly, the Cabinet agreed in principle to a Bank Guarantee, leaving the "details" to be finalised by Lenihan and Cowen. This meeting, rarely mentioned, was in both Lenihan and Cowen's diary.

    28th Sept 2008 Minister Gormley claimed that the guarantee was discussed “on-and-off” for about a week and that Lenihan discussed it with him. Minister Gormley claims that the option that he, Min Gormley, had gone for was the nationalisation of Anglo and a Bill was drafted to effect that nationalisation. Minister Gormley said on the Marian Finucane programme on RTE radio on 4th December, 2010 that there was a Cabinet meeting on the Sunday and the “arrangements” were made after going “through it in detail”

    28th Sept 2008. The Government meeting is noted in Lenihan's diary for 10.a.m.

    http://www.scribd.com/doc/19951170/B...p-08-to-Mar-09

    Cowen's diary also lists a Government Meeting (at Government Buildings, 10.a.m. to 2 p.m.)

    http://www.scribd.com/doc/22646002/Taoiseach-diary

    2010 Daíl debate - http://debates.oireachtas.ie/dail/20...unrevised1.pdf - Questioned by Enda Kenny, Cowen contradicted himself more than once over whether or not the Guarantee decision was discussed by the Cabinet on Sunday. Cowen mentioned that
    "The Minister for Finance when he was speaking on 20 January 2009, said, “It was a carefully considered decision arrived at by the Government after consideration of all the factors at a full meeting of the Cabinet”. The full meeting of the Cabinet took place on the Sunday and an incorporeal meeting of whatever Ministers were available by telephone was held on the Monday night. (This quotation can't be found elsewhere online - if anyone knows the source, please would they let me know it. It appears that the "decision" on Monday night was a bluff without legal standing and it was the subsequent Cabinet and Dail votes that made the Guarantee legal and binding)

    Enda Kenny (Leader of the Opposition; Opposition Spokesperson on Northern Ireland; Mayo, Fine Gael)

    The other fundamental matter is this. On the debate in the House on the bank guarantee, Deputy Noonan asked the Minister for Finance whether this was a matter of liquidity or solvency and he was told it was a matter of liquidity. The Government did not tell the truth to the people. Was the Minister, Deputy Gormley, suffering from lack of sleep when he gave his recollection of what happened? Was the Minister for Finance right when he said that this was decided at a full meeting of the Cabinet, which took place on the Sunday, or was it decided by the incorporeal meeting on the Monday? I would like to know that before we proceed into what will be the last budget to be presented by this Government.

    Brian Cowen (Taoiseach; Laois-Offaly, Fianna Fail)

    As I have outlined to Deputy Kenny, there were no decisions taken whatever on Sunday. The incorporeal meeting that was held on the Monday night-Tuesday morning was the meeting that took the decision. It was not taken on the spur of the moment, as he knows. There was considerable discussion during that night-time and early morning as to what the best options were in the circumstances. I do not accept for a moment Deputy’s contention. There is no question of anyone telling untruths whatsoever or not telling the truth about solvency and liquidity.

    http://www.kildarestreet.com/debates...2-07.2.0#g17.0

    28th Sept 2008 British Chancellor of the Exchequer, Alastair Darling, says he spoke with Minister Lenihan who “assured him the Government would not give a blanket guarantee to the banks”

    PricewaterhouseCoopers says Anglo has lost €10 billion in deposits over the crisis period, including €5 billion of big company and institutional deposits and €440 million in everyday customer or retail deposits over the past week. They warn that Anglo is heading towards a cash shortfall of €12 billion. Anglo’s deposits are now being monitored five times a day. “They knew Anglo was going to drop first,” says one source (Carswell).

    28th Sept. 2008 (Sunday) Merrill Lynch warns the Government that Anglo is close to collapse, that it has exhausted all sources of liquidity, and that it faces a funding deficit of €100 million by Tuesday. Merrill Lynch recommends that the Central Bank provide €5 billion in overnight liquidity in addition to establishing a €20 billion State-backed emergency lending scheme – but points out that this may not be enough for Anglo and Irish Nationwide and that the State may need to take them over. The advisers say, as an alternative to overnight liquidity, the Government could guarantee the six banks, but that this could raise credibility issues given its scale – involving covering bank liabilities of about €500 billion.

    Merrill Lynch sent a detailed memo to the government on Sept 28th:-

    It pointed out that if the Government wanted to wipe out existing shareholders or those holding bonds in these two banks, it would impact on investors, among them Mr Quinn and his family.

    "At Anglo the majority of equity and debt investors are Irish, UK and US institutional holders, but there are significant retail interests, including a major shareholding by Sean Quinn,' the memo said.


    http://www.independent.ie/business/i...e-2262704.html

    "That night, Lenihan and his senior officials met the then Central Bank governor John Hurley in his office on the top floor of the Central Bank’s Dame Street headquarters. Things were serious.”
    Last edited by C. Flower; 08-05-2015 at 09:00 PM.
    “ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
    — Jean-Paul Sartre

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