Monday 26 September 2016

Andrew Langford's new six-figure pay deal at battered insurer FBD

Published 01/04/2016 | 02:30

FBD's former chief executive Andrew Langford
FBD's former chief executive Andrew Langford

Insurer FBD will pay its former chief executive Andrew Langford €16,300 a month to advise the business this year, despite paying him a six-figure sum in lieu of notice when he left the group last July.

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The company's annual report, released to the market yesterday, says FBD paid Mr Langford €269,000 in lieu of six months' notice when he stood down suddenly at the end of July 2015.

However, FBD has now agreed to pay Mr Langford a monthly fee equivalent to an annual salary of €195,000 "to make his services and experience available to the company from 1 February 2016 to 31 December 2016", so long as he is not in full-time employment elsewhere, according to the accounts.

Last night the business, which was forced to sell assets and raise capital on the markets during a gruelling 2015, did not comment on why Mr Langford is being rehired after stepping down.

He was replaced as chief executive of FBD by former Central Bank regulator Fiona Muldoon.

Fiona Muldoon was paid €449,000 by FBD last year.

She was elevated from chief finance officer to the ceo role in mid-year. Andrew Langford earned €594,000 during the year, including pay in lieu of notice.

FBD reported an €85m pre-tax loss for 2015 in its annual results last month.

The insurance firm's shares were hammered last year, and it spent 2015 fire-fighting as it struggled amid a deteriorating claims environment.

The company has hiked premiums in a strategic shift to prioritise profitability over growth.

Late last year, after taking over the top job at FBD, Fiona Muldoon revealed that the financial regulator had been nervous about the company's position prior to it securing financial backing from Canadian firm Fairfax and entering a deal to sell property assets. In September, Fairfax agreed to invest €70m in FBD via a convertible bond.

The Canadian company, founded by Bank of Ireland shareholder Prem Watsa, can convert the bond into equity in FBD after three years and up to 10 years after its issue.

Converting the bond would give Fairfax about a 19pc stake in the Irish insurer.

FBD also agreed to sell its 50pc stake in its leisure business for €48.5m.

It was sold to Farmers Business Development, which also owns almost 29pc of FBD.

Irish Independent

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