Urgency but no panic for a midnight special
When news of the liquidation broke, Noonan knew he had to act quickly
Just before 4pm on Wednesday, the Department of Finance received separate calls from the Reuters and Bloomberg news agencies. Officials were asked to confirm a story that the failed Anglo Irish Bank, now operating as the Irish Bank Resolution Corporation (IBRC), was to be liquidated as part of the arrangement with the European Central Bank to ease the State’s punitive repayment burden on Anglo’s €28 billion promissory notes.
What the agencies had established was credible and true. The liquidation of Anglo was indeed a linchpin of the delicate formula being worked on. News of the potential liquidation of Anglo spreading like a virus on the wires posed an immediate risk to the assets of the bank. Minister for Finance Michael Noonan was well aware he needed to move quickly.
According to officials within the Department of Finance there was a sense of urgency but no panic. It was clear that the Government had not been blindsided by the development – a contingency plan for such an eventuality had been in place since last September.
Noonan himself said yesterday that despite the image of Anglo as a “clapped-out” bank it still had €12 billion to €14 billion worth of assets to protect. He was not prepared to allow creditors or other parties to challenge, or try to prevent, a liquidation.
The liquidation plan was highly secretive. As Noonan disclosed yesterday, neither IBRC nor its chairman Alan Dukes was brought into the ring of confidentiality and were wholly unaware of the plan.
But the ECB and its satellites had been aware for months. There had been several “scares” in recent months, Noonan said, that a substantial leak was about to happen, but none had come to pass until this week.
The contingency plan was two-fold. A 58-page Bill to liquidate the bank was drafted and ready to go for many months. A senior partner from KPMG was on standby to go into IBRC at short notice.
Within 15 minutes the KPMG team was at IBRC headquarters informing Alan Dukes and the bank board that they must relinquish control. The Cabinet met in urgent session, one of a number of meetings Ministers held to pave the way for the emergency legislation.
From before 5pm rumours spread in Leinster House of emergency legislation.
President Michael D Higgins, who was on an official visit to Italy, was informed that he might need to be available to sign the Bill into law early yesterday morning. The Government jet was scrambled and the President left Italy for Ireland at 7.30pm.
By 6pm, the Government had confirmed informally that the Bill, the Irish Bank Resolution Corporation Bill, would come before Dáil and Seanad on Wednesday night.