Taoiseach Brian Cowen has said the independence of the Financial Regulator must not be compromised in the search for a resolution to the “very complex situation” at the Quinn Group.
Speaking in Dublin today Mr Cowen said while the independence of regulator Mathew Elderfield had to be respected, there was a need to maintain employment at the group and to protect the taxpayer. He also appeared to rule out State aid to the firm.
Michael McAteer and Paul McCann of Grant Thornton were appointed provisional administrators to the insurer by the High Court last week after the regulator became concerned the company had significantly breached its solvency ratios.
The regulator also ordered that the insurer stop writing business in the UK to prevent further losses.
The administrators handed over a report on Quinn Insurance to the regulator today ahead of a High Court hearing next week. The Regulator's office declined to comment on the report.
Employees of the group have staged a number of protests against the regulator's action, amid fears for the jobs of the 5,500 people it employs. Another march in protest at the regulator's action will take place in Enniskillen, Co Fermanagh, this evening.
Seán Quinn said yesterday the company was losing money as a result of the action and estimated Quinn Insurance could lose up to 80 per cent of its turnover for April.
The group owes State-owned Anglo Irish Banks €2.8 billion.
Speaking at the opening of the new museum at Glasnevin Cemetery Mr Cowen said: “Every person has a role to play here [in resolving the issue]. But the independence of the regulator is respected obviously,” said Mr Cowen.
“There are issues to be addressed in that respect and all the discussions that are taking place is an effort to find a solution and meet those sort of requirements.
Asked if taxpayer’s money would be used to bail out the group, Mr Cowen said: “The Minister for Finance has pointed out the need to see in what way a solution can be found that best protects the taxpayer in this whole situation.”
The Quinn Group has said the guarantees provided by the insurer’s subsidiaries to its bondholders and other lenders – which led to the regulator’s court action – could be withdrawn and solvency could be restored to the insurer with a further €100 million in additional borrowings.
Mr Quinn conceded the regulator was “technically right” to take his action but said he should have met directors before putting the company into provisional administration.
Meanwhile, the Financial Regulator has responded coolly to a proposal from Anglo to take control of Mr Quinn’s business and restructure the struggling insurer in a bid to secure repayment of €2.8 billion owed by the Quinn family.
The regulator met senior Anglo executives privately on Tuesday to discuss the bank’s proposal, which was devised by the new management team at the bank. However, it is understood that the regulator is intent on progressing with its court application to confirm the appointment of administrators.
Among the proposals suggested by Anglo was that the Quinn Group be taken over by the State-owned bank, that Quinn Insurance be put on a sound financial footing with support from the bank and be eventually sold for a higher price than it would in the short term.