Former bank boss Duffy condemns 'flawed' report on HBOS failure
Published 21/11/2015 | 02:30
Mark Duffy, the former boss of Bank of Scotland's Irish operation, has lashed out at highly critical report by the Bank of England's financial watchdog that claims the business engaged in risky and "uncontrolled" expansion as it battled during the boom to become a major force in the Irish banking market.
Speaking exclusively to the Irish Independent, Mr Duffy said that he was not even interviewed by Britain's Prudential Regulation Authority (PRA) as it prepared a report in conjunction with the UK's Financial Conduct Authority (FCA) into the collapse of HBOS, which owns Bank of Scotland and Halifax.
The report, published on Thursday, said that losses racked up at Bank of Scotland (Ireland) contributed significantly to the failure of owner HBOS in 2008.
It was subsequently bought by Lloyds, on the direction of the British government, which also used £21bn (€31bn) of taxpayers' money to save HBOS.
"They get it wrong on Ireland; it's flawed on Ireland; and the process is flawed on Ireland," he claimed regarding the report.
"Nobody (who had worked at Bank of Scotland's Irish arm) was given an interview. I've never spoken to the enquiry. Not once," he added.
The report claimed that Bank of Scotland's expansion in Ireland in the last decade was a "blueprint for rapid uncontrolled growth with inadequate risk mitigation".
It has insisted that Bank of Scotland's Irish arm (BOSI) didn't have sufficient staff resources to fuel its expansion.
Mr Duffy said he saw the first draft of a section of the report on Ireland 18 months ago at the PRA office in London, which he attended with his lawyer, where he signed what was "effectively a gagging order" before being permitted to see the extract. "I looked at what was put to me, and I had serious problems with it. It was seriously flawed," he claimed.
Mr Duffy said that he asked the PRA for access to documents which it was using to generate its report, and also for access to people involved in the enquiry.
"I couldn't get access to case files; I couldn't speak to former colleagues, even when I put the invitation to the PRA to speak to them they never got back," said Mr Duffy. "I thought it was a very unfair process."
"The report was very pejorative about Ireland. It was like they were writing the book from the conclusion backwards."
Read the interview in full