Inside the world of business
Things get curiouser and curiouser for IBRC
THE ONGOING and presumably hugely expensive effort by Irish Bank Resolution Corporation (IBRC) to seize properties in Russia, Ukraine and elsewhere continues to take up court time around the globe.
Anglo Irish Bank, when giving out hundreds of millions of euro to the Quinn family a few years ago, must have thought it had its collateral well and truly tied down, with share pledges, personal guarantees and mortgages stretching across continental Europe.
As with so much else, it transpires it was wrong. Legal agreements and property rights are not worth the paper they are written on if you can’t have faith in the courts.
The shenanigans involving the Quinn family’s international property portfolio have been an eye-opener for many here as to the nature of the legal systems in Ukraine and Russia.
IBRC’s campaign to get control of a shopping centre in Kiev worth up to $60 million (€45.6 million) has included a local public relations campaign designed to put pressure on the authorities there to intervene.
Yesterday yet another press release was issued by the local PR company the bank has engaged, outlining the “raider seizure” of the property and the “legal sensations” that have occurred courtesy of the local courts.
These include a “conveyor of identical lawsuits” sometimes in the names of parties who don’t know they’ve been taken, the ignoring by the local court of foreign court decisions relevant to the case, and supposedly random allocations of judges to the case that have involved chance-defying outcomes.
Events in Moscow, including decisions in the local courts, have not been as well publicised but have been equally bizarre.
All of which sparks a number of thoughts, including wondering who is behind all these strange and mysterious goings on.
It also makes you wonder whether Seán Quinn’s judgment may have been as much at fault in his international property acquisitions as it was in the disastrous positions he took on Anglo’s shares.
Testing times at BoI and EBS
WHAT A difference a year makes. In April last year the newly minted Minister for Finance Michael Noonan (below) told the Dáil about his plans to sort out the boards of the Irish banks.
The context was the publication of the Nyberg report into the causes of the banking collapse, which was critical of the groupthink that had caught hold in the boards of the banks. Noonan pledged to clear the boards of members appointed before September 2008.
“I’m not saying that they are personally culpable. I am simply saying that the crisis occurred on their watch and it’s normal that if the crisis occurs on your watch that you depart subsequently,” he said.
The Minister’s tough talking of last year is in marked contrast to the much more emollient and hands-off tone he adopted in the Dáil this week when quizzed about the amount of money that EBS and Bank of Ireland were spending on preparing submissions to the Central Bank on the fitness and probity tests EBS chief executive Fergus Murphy and Bank of Ireland chief executive Richie Boucher must undergo.
The test has emerged as the hurdle all pre-September 2008 directors must pass if they want to stay on after the end of 2011. Both banks have hired US consultant Promontory.
Noonan was at pains to point out in written reply to a question from TD Joe Higgins that he did not approve the hiring of the consultant. He distanced himself even further from the issue, saying that while the State was the biggest shareholder in the banks they had to be run at arm’s length because the European Commission, ECB and IMF insisted on it.
What has changed apart from Noonan’s rhetoric? Well, for one thing the Government has managed to attract a group of high-profile North American investors into Bank of Ireland. They appear to be great admirers of Boucher and are unlikely to approve of any efforts to bounce him out of the bank on the back of a fitness and probity test.
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