Small shareholders vent their spleen at BoI AGM
SHARES in Bank of Ireland fell again yesterday, pushing losses for shareholders to 22pc since the bank announced a rights issue three weeks ago.
The recent tumble left shareholders nursing fresh losses as the country's largest bank hosted its annual general meeting and prepared to post shareholders the details of a second rights issue within a year.
Yesterday's AGM was exceptionally bitter, with small shareholders complaining about what had happened to their bank and their shares, which have fallen from a high of €11.86 in early 2007 to just 12.8c.
"Being at this AGM is like being at a wake, with the bank being the corpse," muttered John Flynn before calling on the management to "call (undertakers) Corrigans and bring the bank to Deansgrange or Glasnevin" for burial.
Analysts remain divided on whether the bank will be in majority state control by the end of the summer.
While shareholders were critical, management was relatively upbeat, maintaining that the economy had stabilised and that last year's €20bn run on the bank's deposits had ended once the then Government agreed the €85bn bailout with the IMF and EU in November.
While chairman Pat Molloy remained unfailingly calm in the wake of an angry tirade from the floor, it was impossible not to feel some admiration for Bank of Ireland's army of shareholders yesterday -- but it was the sort of grudging admiration usually reserved for those Japanese snipers who fought the US army island by island without any hope of success after Hiroshima.
Shareholders lobbed eggs and sometimes elegant verbal grenades in a three-hour skirmish with the bank's top brass -- knowing that whatever they said and however they voted, the institutional shareholders would still back management.
Mr Molloy opened battle with a full-frontal assault aimed at boring shareholders into submission, as he droned on about the 2010 results for more than half-an-hour, while the restless audience fidgeted and waited for an update on the bank's latest rights' issue -- an update that never really came because the documents will only be sent off in two days' time and must be discussed at a special shareholder meeting on July 11.
Looking at the thousand-or-so shareholders sitting in UCD's O'Reilly Hall yesterday, it was tempting to speculate on how much had been lost by this relatively small number of people. Assuming that each of those who attended the meeting owned 10,000 shares, it would be fair to say that those gathered yesterday had seen the collective value of their holdings plunge from around €120m to just €1.2m today. That's an awful lot of money that could have been spent on nursing homes and retirement holidays.
"You have robbed the elderly; you are guilty of elder abuse," Mary Carr told the generals, after Pat Molloy had avoided two eggs from the floor.
Other shareholders were equally convinced that crimes had been committed. Mark Veal told the meeting that he wished he was sitting in a "court of law and that the podium up there should be in the dock".
The top brass also came under fire from Eleanor Dunne, one of the bank’s staff and the youngest shareholder to speak, who told her superiors they had “no idea of the problem” and lacerated the secret bonuses which had only been revealed in the media after the bank misled the late Brian Lenihan and the Dail about the number and scale of bonus payments.
“To say we were disappointed is an understatement – we were embarrassed on behalf of the industry,” she said.
While the onslaught continued, Pat Molloy parried with blandness.
“You are entitled to your opinion,” he purred again and again as he was charged with everything from financial treason to outstaying his welcome.
Having joined the bank after the crash, he has a certain credibility allied to social skills that the taciturn CEO Richie Boucher lacks.
Half-a-dozen shareholders suggested that Mr Boucher was overpaid or simply not up to the job, but like the bank’s other directors, he continues in the job today following support from institutional investors.
The most extraordinary aspect of the bank’s pompously named annual general court (AGM to the rest of us) was that five of the six directors standing for re-election served on the board prior to 2008. Despite the bank’s avowed policy of “refreshing” the board, it is about as fresh as John McEnroe’s or Bjorn Borg’s socks.