Anglo brand to go but its legacy to linger for years
Published 30/11/2010 | 05:00
ANGLO Irish Bank's brand will disappear "within weeks" as the Government accelerates plans to remove Ireland's most toxic lender from our financial landscape.
Central Bank Governor Patrick Honohan confirmed the Anglo brand's imminent demise in a radio interview yesterday. He later stressed it would take years to deal with its loans.
Anglo was due to be split into a savings bank to hold deposits and an asset-recovery bank that would run down Anglo's loans over about 15 years.
Prof Honohan confirmed that the Government now wants to find "comfortable homes" for Anglo's deposits and run down the bank's €36bn loan book.
Management are believed to be pushing for a swift resolution of the situation and hope to get agreement "in principle" on a restructuring plan in January.
The plan is expected to see Anglo's deposits -- believed to be between €12bn and €15bn -- handed over to AIB and Bank of Ireland. Anglo's loans would be sent to a new asset recovery bank, which would also take loans from Irish Nationwide and be staffed by current Anglo and Nationwide workers.
Anglo chairman Alan Dukes last night confirmed the bank had already come up with "a couple of names" for the new asset recovery institution.
This list is expected to be submitted to the Department of Finance over the coming weeks, but sources stressed that there would be no major marketing spend on the name-change.
While Anglo's name would disappear imminently, chief executive Mike Aynsley last night said it was "clearly impossible" to close Anglo overnight.
He also moved to reassure the bank's 1,500 staff that "no decision" had been made to shut down their employer. Any such decision would have to be approved by the European Commission, the Department of Finance, the Central Bank and the National Treasury Management Agency, he said.
The Central Bank said a revised restructuring plan for Anglo would be sent to the European Commission by the end of January. "Any wind-down of the Anglo loan book would, however, be over a multi-year basis," the statement added.
Opposition politicians last night criticised the delay in shutting Anglo, with Fine Gael frontbencher Leo Varadkar saying the move came "two years and billions of euro too late".
The latest plan represents the third attempt at resolving Anglo, which is set to cost the state between €29bn and €34bn over the next decade.
The original plan was for Anglo to be split into a "good bank" that would hold good loans and deposits and continue lending, and a "bad bank" that would collect payments for troubled loans.
That plan was axed in September after it received a cool reception from the European Commission. It was replaced by a proposal for a funding bank and an asset-recovery bank.
"The problem with that was, as soon as the Government announced the deposits would be put into a funding bank, the deposits starting going out the door," one source said.