Courts

Saturday 26 July 2014

Anglo couldn’t lend money on different terms, banking expert tells trial

Sarah Stack

Published 02/04/2014|12:23

  • Share
Tom Reid arrives to give evidence at the Anglo trial
Tom Reid arrives to give evidence at the Anglo trial

A banking expert has rejected claims Anglo Irish Bank could lend money on different terms than other institutions as it was a business bank targeting business people.

  • Share
  • Go To

Tom Reid also told the trial of three Anglo Irish Bank executives he would have been concerned if his employer was approaching customers with a proposition for a loan.

The expert witness worked for Ulster Bank for 40 years until 2004.

He disputed claims by Patrick Gageby, senior counsel for William McAteer, that Anglo differed from Ulster Bank, Bank of Ireland and AIB as it was a business bank with no ATMs or branch network.

"It was no different when it comes to lending money," he replied.

Anglo’s former chairman Sean FitzPatrick (65), from Greystones, Co Wicklow; former head of finance and risk William McAteer (63), of Rathgar in Dublin; and Pat Whelan (51), of Malahide, Co Dublin, deny 16 counts each of providing unlawful financial assistance to 16 individuals in July 2008 to buy shares in Anglo Irish Bank.

The loan-for-shares deal involved unwinding Sean Quinn’s secret 29pc stake in the bank, build up through contracts for difference (cfds).

The 16 charges relate to loans to six members of the Quinn family and 10 high net worth Anglo clients, who became known as the Maple 10, who were approached by the bank.

Mr Whelan, former head of lending (Ireland), also denies being privy to the fraudulent alteration of loan facility letters to seven individuals.

Mr Reid was head of group lending and director of group risk at Ulster Bank until 2000, when he joined the board.

He said he would have made sure it acted with total integrity at all times.

Under cross examination he was asked if the bank had, with his knowledge, ever approached a customer with a proposition.

"I would be concerned," he said to Mr Gageby.

Yesterday he told the court he would never have approved E45m loans to the so-called Maple 10 to buy shares in Anglo Irish Bank given the terms of the lending and 25pc recourse.

He has maintained all personal loans should have 100pc recourse, meaning the borrower is liable to repay all the money if the share price fell.

The trial at the Circuit Criminal Court in Dublin continues.

Read More

Classifieds

CarsIreland

Independent Shopping.ie

Meet, chat and connect with
singles in your area

Independent Shopping.ie

Meet Singles Now

Findajob

Apps

Now available on

Editor's Choice

Also in Irish News