Quinn’s stake raised with Department of Finance on an ‘ongoing basis’

Bank thought its problems were ‘Ireland Inc’ problems, court told

Witness Con Horan at Dublin Circuit Criminal Court yesterday. Photograph: Collins Courts.

Witness Con Horan at Dublin Circuit Criminal Court yesterday. Photograph: Collins Courts.

Wed, Mar 12, 2014, 01:00


Businessman Sean Quinn’s holding in Anglo Irish Bank was discussed with the Central Bank and the Department of Finance on an “ongoing basis” in 2008, an official from the Financial Regulator’s office has said.

Con Horan, then prudential director at the Irish Financial Regulatory Authority (Ifsra), agreed he was “ hands on” with Anglo in relation to the Quinn holding, but said because it was “a major issue”, it was the subject of discussion with the Department of Finance and the Central Bank. The three entities met regularly as the Domestic Standing Group, the court had heard.

Mr Horan also said the board of Ifsra asked him to speak to the Department of Finance and the Central Bank “to see if some domestic solution” could be found to deal with the Quinn holding.

By 2008, Mr Quinn held contracts for difference – investment products based on share value – in Anglo amounting to 29 per cent of its shares. The bank and the regulator were concerned, the court had heard.

Brendan Grehan SC, for Pat Whelan, asked if the regulator’s office was “putting Anglo under pressure” to resolve the Quinn holding position.

Mr Horan, who now works for the European Banking Authority in London, responded that there was “certainly an anxiety to see the position unwound” and “active engagement to resolve the situation”.

On his second day in the witness box, Mr Horan also said in April 2008, Anglo did not believe it was “like Northern Rock” but believed its problems were “more an Ireland Inc problem than an Anglo problem”.

Mr Horan said the main thrust of a meeting on April 30th held in his office with officials from Anglo was to discuss how the bank might mitigate future problems following a “mini-run” on it in March.

But Mr Grehan said a previous witness, bank director Anne Heraty, had said the bank was asked to release the Quinn group from a guarantee at that meeting.

Mr Horan responded that he did not recall, but it did not surprise him. The board of Ifsra had asked him to encourage the bank to release the guarantee.

The court had heard that the guarantee from the Quinn Group held by the bank was of concern to auditors in the spring of 2008 and the accounts could not be signed off because of it.

Mr Horan said the board was keen to see if the issue could be resolved. He acknowledged that as a regulator “you wouldn’t want the bank releasing securities unless you felt the consequences [of not releasing] would be worse for the bank”.

He said the concern was a liquidator might be appointed to the Quinn Group.