'I have behaved in a competent manner', Lenihan insists

 

Minister for Finance Brian Lenihan has said he has no plans to step down after coming under intense political pressure following his admission that he only learned about the transfer of €7 billion to Anglo Irish Bank last month, even though his department informed the Financial Regulator about the issue last October.

Speaking this morning the Minister said: “I certainly am not considering my position because I have done nothing wrong.

“I have behaved in a competent manner as Minister for Finance.”

Mr Lenihan told the Dáil last night that information about the transfer of €7 billion from Irish Life and Permanent (IL&P) to Anglo was contained in a report by PricewaterhouseCoopers to his department last October.

He said his officials had then referred it to the Financial Regulator but had not informed him about it.

Stressing that he only learnt about the issue last month, he said the money transfer was not identified as a risk factor in the 720-page report.

This morning Mr Lenihan said: “I wouldn’t fault my department for not telling me at that stage”.

“They did tell me subsequently when the matter came into sharper focus when a subsequent due-diligence exercise was analysing the deposit base of the bank," he told RTÉ's Morning Ireland. “I don’t believe my officials should be scapegoated on this matter.

“But I’m not convinced if I had read the passage that its significance would have jumped out at me at that stage because the focus of the report was on risks associated with the loan book of the bank not on accounting matters of accounts transferred between banks”.

The €7 billion transfer to Anglo helped to bolster the bank’s financial strength before its year end last September following deposit withdrawals of €4 billion during the month.

The transaction remained in place for just several weeks and enabled the bank to prop up its deposit levels and disguise the dramatic levels of withdrawals suffered by the bank during the unprecedented financial upheaval last September.

The Opposition claims that Mr Lenihan’s credibility had been undermined by his admission.

Labour leader Eamon Gilmore said earlier on the same programme that he has “no confidence” in the Minister.

“These were the consultants that he appointed to go and find out what was going on in the banks, he didn’t read the information and more importantly didn’t give the information to Dáil Éireann before he proposed that one of the banks Anglo Irish Bank be nationalised,” he said.

Fine Gael leader Enda Kenny described Mr Lenihan as a man of integrity, but added: “There is a lesson here for everybody. The Minister did not read the full report but the politics of his ministerial office should have put him on alert when his officials told him a section of this report should be referred to the regulator . . . alarm bells should have gone off at that stage.”