Anglo encouraged me to borrow vast sums -- developer
Published 17/04/2010 | 05:00
A DEVELOPER being pursued by nationalised Anglo Irish Bank for €84m has claimed he had "easy access" to senior figures like Sean FitzPatrick and David Drumm, the High Court heard yesterday.
The case relates to loans of more than €165m advanced by Anglo to three companies in the Fordmount group and two partnerships to buy lands and buildings in and around Limerick city and county.
When they were not repaid by December last, the bank appointed a receiver over most of the assets of the companies.
Fordmount Property Group's Michael Daly said he was actively encouraged by Anglo to undertake massive property developments with the assurance that hundreds of millions of euro would be made available.
During 2006 and 2007, the bank was "extremely anxious" to lend money to him, Mr Daly said.
"Rather than I applying to the bank to borrow money, the bank met me on regular occasions to plan the future projects of the group."
He was regarded as "a favoured developer" in the mid-west region and could just pick up the phone to Anglo in Dublin and would be told to buy, he said.
His companies spent more than €300m on development projects in Ireland, plus more than €100m on projects in Germany.
He made the claims during an application yesterday by Anglo for summary judgment orders for €84.4m against him arising from personal guarantees he gave on a number of loans. Mr Daly is opposing the application.
Mr Daly claimed that in 2006 and 2007, Anglo was anxious that the group made additional investments in Germany and its then chief executive, David Drumm, made it clear that funds of up to €500m were available. Anglo also targeted his group for annual additional borrowings of up to €150m for various projects, he said.
Representing himself, Mr Daly, of 'Dalmin', North Circular Road, Limerick, said he had relied on oral assurances from Anglo executives that personal guarantees on the loans were secondary to the security taken by the bank and would never be relied upon.
However, the bank failed to take proper security and its handling of securities was "a shambles", he said.
In an affidavit, Mr Daly said one loan of €91.2m was provided on the basis of his own guarantee, capped at €9.5m, plus a guarantee of his partners, also capped at €9.5m.
Anglo, through a receiver appointed by it, now had control of the relevant assets and it was consequently absolutely premature to be taking action against him, he said.
Maurice Collins, for Anglo, said the bank was clearly entitled to summary judgment because Mr Daly, an accountant and experienced businessman, had accepted that the money had been loaned and he had signed the guarantees.
Counsel described as "incredible" claims by Mr Daly relating to Anglo's approach to the guarantees.
The case will resume next Tuesday.