Developers tell inquiry how banks brought them on foreign junkets
Published 25/08/2015 | 02:30
Two of the country's leading property developers have revealed details of corporate hospitality lavished on them and their associates by banks during the boom.
Trips to the Ryder Cup in Kentucky and other major sporting events were among junkets detailed by developers Gerry Gannon and Peter Cosgrave in statements to the Oireachtas Banking Inquiry.
Former AIB group managing director Colm Doherty also told the inquiry that entertainment it provided to developers was "multi-faceted, occurring across a number of countries in which we operated".
In a written submission to the inquiry, Mr Gannon detailed a trip to the Ryder Cup courtesy of AIB in 2008, a trip to Venice with Anglo Irish Bank, and further corporate hospitality afforded to him by Anglo at a race meeting at the Curragh.
Another executive director of Gannon Homes, Aidan Kenny, was brought on a trip to Paris by Anglo, Mr Gannon told the inquiry.
Peter Cosgrave said it was impossible to provide the inquiry with an exhaustive list of hospitality arranged by the banks for senior executives in the Cosgrave Property Group.
However, in a written submission, he was able to outline trips to several of the world's most prestigious sporting events, as well as golf days in the UK, France and the US, courtesy of Ulster Bank, AIB, EBS and Bank of Ireland.
Trips to the Irish Open and British Open golf tournaments were organised by Ulster Bank, while Ulster Bank and AIB brought senior executives to the US Masters in Augusta, Georgia.
AIB organised trips for senior management to the Monaco Formula One Grand Prix and to the Ryder Cup in the US.
Horse racing also featured on the list provided by Mr Cosgrave.
Bank of Ireland brought company executives to the Prix de l'Arc de Triomphe.
AIB and EBS hosted senior management at race meetings in Punchestown and Leopardstown.
There was also a once-off ski trip and visits to the opera and theatre organised by Ulster Bank.
In a written submission, former AIB managing director Colm Doherty told the inquiry that where corporate hospitality was valued in excess of €500, it had to be recorded in a business unit register within the bank.
He said he believed the corporate hospitality and entertainment spending by AIB on corporate clients was "generally appropriate" and "on par with common practice in the industry".
Mr Doherty said he could not comment on the extent of entertainment provided by the bank to developers.
However, he said he was aware AIB had brought "a large contingent of property clients" to the Ryder Cup in Kentucky.
Property clients were also provided with the use of corporate boxes in Croke Park and tickets for rugby and soccer matches, concerts and the theatre.
Mr Doherty said AIB had developed a policy on the giving and receiving of gifts in 2003, setting out ethical standards for staff to abide by.
This permitted gifts, benefits or entertainment valued up to €500. Any gifts valued between €500 and €1,000 had to be registered, he said.
Pre-approval was required for the acceptance of any gifts, benefits or entertainment valued in excess of €1,000.
Mr Doherty said he believed the limits set out in the policy were appropriate.
He said he was aware of only one instance where hospitality received by AIB staff members from a loan client was deemed inappropriate.
"This occurred in our UK business. In this case the executives involved were subject to disciplinary proceedings, resigned and left the bank," he said.