Anglo boss hits out at Green Party call for bank wind-down
Published 31/08/2010 | 05:00
THE boss of Anglo Irish Bank last night hit out at the Green Party's call for a faster wind-down of the nationalised lender.
The Greens will raise the contentious issue of winding-down the bank over four to five years, at tomorrow's first Cabinet meeting since the summer break.
Any rift between Fianna Fail and the Greens has been played down, with both the Department of Finance and Justice Minister Dermot Ahern insisting everyone simply wanted to minimise the cost of the bank to the State.
The debate over Anglo's future comes as the bank prepares to today unveil another set of massive losses for the first half of the year.
Anglo chief executive Mike Aynsley has already warned this year will see more "horrendous" results, and experts are expecting losses in the €4bn range for the first six months.
But Mr Aynsley was scathing in his response to the Greens' comments, saying it was "difficult to understand" views that don't take account of the "detailed analysis" that had been prepared to assess Anglo's options and find the best way to limit the cost to the taxpayer.
"While some of the information is commercially sensitive, we are more than willing to sit down with interested parties and take them through it," he said.
"If the Green Party's Finance spokesman is interested in getting an informed perspective he is more than welcome to meet us," he added.
Sources close to the bank also stressed that it would be "no surprise" if the European Commission imposed some limitations on Anglo's so-called 'good bank'. "The EU always applies growth constraints on restructured banks," one said. "Anglo has always expected that."
Sources also pointed out that Anglo "continues to engage" with the commission and has been given no indication that plans to split the institution into a good bank and a bad bank were about to be vetoed.
The Government is understood to be hoping for an EC verdict on the split plan by the end of September, at the latest.
Economist Dermot O'Leary of Goodbody Stockbrokers claimed there is now an urgent need for the Government to announce a set plan and detailed final cost for the bank.
Certainty and closure on the issue are now crucial, he said.
Fine Gael also rowed in, claiming the way the Greens had announced their changed position could add political instability to the financial instability. And the Labour Party claimed the divisions between Fianna Fail and the Greens would fuel further uncertainty.
Two plans for the bank are still being considered by the European Commission but the Greens have now clearly opted for one option, while the Department of Finance is still awaiting a verdict.
One of the plans being considered by the European Commission proposes dividing Anglo into a 'good' and 'bad' bank with the good unit taking assets worth between €10bn and €15bn and reinventing itself as a small business lender.
The other plan is to close it down over an, as yet, unspecified period of time.
It is understood Brussels is becoming increasingly sceptical of the 'good bank' proposal.
However, Anglo chairman Alan Dukes claimed this was at variance with what he is hearing from the ongoing talks with the EU Commission.
The rising cost of rescuing Anglo was partly responsible for a surge in Irish bond yields last week with interest rates reaching highs of 5.9pc.
Mr O'Leary claimed any perception of two government parties being at odds on the direction of the bank would not be helpful to the markets.
"That certainly doesn't help either. One of the benefits, I suppose, over the past two years since October 2008 has been that there has been some level of political stability. ," he said.
"Some sort of spat in government would not help from an international perspective."
Adding to the confusion over the Greens position, Justice Minister Dermot Ahern insisted there was no division within government over Anglo.
"There is no political difficulty with the Greens and indeed Fine Gael. We all accept and want ultimately to get the minimum exposure to the Irish taxpayer, and that is the over-riding principle," he said.