We are a complete punchbag at this stage, says Drumm
Published 08/07/2013 | 05:00
ANGLO Irish Bank believed the State was treating it "like a f**kin' bucket shop" in its final months before being nationalised.
Newly published Anglo Tapes reveal the mood in the doomed bank in November 2008, in the weeks after the state guarantee.
The bank's chief executive David Drumm again features prominently, in conversation with the bank's head of treasury John Bowe.
Just weeks earlier the pair had laughed about "abusing" the bank guarantee, with Mr Drumm giggling at Bowe's now infamous rendition of 'Deutschland Uber Alles'.
But a month later, Mr Drumm admits that it was becoming clear that the decision by the government to blanket guarantee its banks was beginning to poison Ireland's ability to fund itself in the markets.
During the revealing conversations, it is clear that Mr Drumm knows at this stage that the fate of Anglo and Ireland are now bound together inextricably.
But he is obviously more concerned about the survival of his own bank.
In this latest tape, Mr Drumm can be heard telling his colleague Mr Bowe that "We're just a complete punchbag at this point".
"I wonder is it time for to us act the complete bastards?" Mr Drumm ponders.
He also complains to Mr Bowe that the State seems more concerned with smaller institutions like Irish Nationwide and EBS than it is with Anglo.
Mr Bowe and Mr Drumm moan that Anglo should be given priority over its rivals by the State.
"You know we need to get billions," Mr Bowe says at one point.
"We're a bigger bank and we're being treated like a f**kin' bucket shop," Mr Drumm complains.
Mr Bowe tells Mr Drumm that he has been down to the Central Bank to discuss how Anglo can raise money.
Mr Drumm says he's had his own meetings with the National Treasury Management Agency (NTMA), which is responsible for funding the State.
Following the bank guarantee, Ireland's banks are now tied to the sovereign – so the NTMA is concerned that the banks must break this link by starting to raise fresh funds from the market.
Mr Drumm said he managed to stay "nice and relaxed" in the meeting.
"I didn't have the eyeballs f**kin' flaring out of my head like I usually do, so it went well," he said.
Mr Drumm then describes a conversation he had with a respected senior figure in the NTMA.
Revealingly, Mr Drumm says that this NTMA official told him: "Why is the funding keeping you awake at night? That's not an Anglo problem, that's an everyone problem."
This comment shows that Ireland's toxic banks, after the bank guarantee, are now fatally entwined with the State's ability to fund itself.
Ireland is already at the beginning of its long slide into the humiliating EU-IMF bailout of 2010.
He also says that John Hurley, the governor of the Central Bank, is "worried" that Anglo needs billions from it.
Mr Drumm tells Mr Bowe to contact Brendan McDonagh (another senior NTMA official who now heads the National Asset Management Agency) to try and get Anglo bumped up the priority list.
Mr Bowe suggests arguing that Anglo's interests "need to be protected" and doing so is "in the State's interest".
Mr Drumm urges Mr Bowe to try to convince Mr McDonagh to argue that Anglo should be prioritised over bigger banks AIB and Bank of Ireland.
Mr Drumm says: "Why don't you ring him and say, 'I need a bit of help here, Brendan, because I felt outnumbered down there and they're going to ask backwards here because we've a vulnerability and it's only just f**kin' taken away from the f**kin' have-nots (Ireland's weaker banks) and given to the haves (Ireland's stronger banks). "
There is no suggestion that Mr McDonagh, who worked tirelessly for Ireland in the NTMA during the crisis, listened to Anglo's pleadings.
The fact, however, that Anglo felt the guarantee meant its success was now tied to the State's survival is both noteworthy and accurate.
Mr Drumm closes his chat by referring to Central Bank governor John Hurley as "El Govo" – a phrase usually more suited to a Latin American banana republic.