Irish

Thursday 21 August 2014

Revealed: top 13 borrowers who owe Anglo

Builders, Secret Millionaire and O'Brien on list

Tom Lyons

Published 15/04/2012 | 05:00

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Former Anglo Irish boss David Drumm

Information obtained by the Sunday Independent has revealed for the first time the top 13 borrowers of the former Anglo Irish Bank, which is now called IBRC.

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The 13, which include developers such as Joe O'Reilly and Bernard McNamara, owed a total of €13.9bn in March 2009, according to a government review by accountants PWC, which was completed around May of that year.

PWC told the Government that the bank's top borrowers would only cost the State €629m and that the bank was "not unreasonable" in its prediction in March 2009 that losses on the entire loan book would only be €4bn.

This figure has since ballooned to between €25bn and €30bn demonstrating how badly the property crash caught out the then government and its many advisers.

IBRC's biggest individual borrower by a long stretch is the family of Sean Quinn, which then owed the State €2.2bn, and they are joined on the list by a number of Ireland's best-known property developers.

Denis O'Brien, the telecoms entrepreneur, is listed as owing Anglo Irish Bank €833.8m on foot of personal and corporate loans just after the bank was nationalised in 2009, making him its then sixth largest borrower.

Mr O'Brien has over the past three years reduced his borrowings to under €500m using cash generated by his Caribbean and Pacific-based mobile phone empire.

Ireland's fourth richest man is understood to hope to reduce his borrowings to €300m some time this year as part of an extensive, agreed debt-repayment plan. He has not missed an interest payment and is considered the bank's best-performing large borrower.

Mr O'Brien's mobile phone company Digicel has debts to various banks of billions but it also had revenues last year of $2.23bn and earnings of $954m making it more than capable of servicing its debts.

Digicel raised $250m in February through a bond issue which was used to buy a rival mobile phone company in Haiti for $97m. Some of this money, combined with Digicel's strong cash generation, may have been used to reduce Mr O'Brien's debts to IBRC and to fund his €45m acquisition of Siteserv, the infrastructure and utilities support services business.

This purchase was controversial as the taxpayer took a €105m hit on Siteserv's sale and there were allegations that the company might have been sold for more to a trade buyer. This has been denied by Siteserv and its advisers.

Mr O'Brien's borrowings from Anglo go back to when he founded 98FM, the Dublin pop radio station, and continued as he bid for Ireland's second mobile phone business. It lent to him when he set up Digicel in the Caribbean and branched into golf and property investments.

The multibillionaire, who employs 2,000 people in Ireland, has defended his friend Sean FitzPatrick, Anglo's former chairman, who has become a scapegoat for Ireland's entire economic collapse. "Anglo Irish Bank has been blamed for absolutely everything that has gone wrong in Irish banking. That is both wrong and unfair," Mr O'Brien said in 2009.

Much of Mr O'Brien's and his fellow 12 borrowers' lending took place under David Drumm, Mr FitzPatrick's successor as chief executive, with funding from German and French money markets.

Denis O'Brien is the largest single shareholder in Independent News & Media, the publisher of the Sunday Independent. He has lost an estimated €500m on his 21.6 per cent stake in the media group.

A spokesperson for Mr O'Brien declined to comment.

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