Monday 11 December 2017

Fingleton says he was 'wronged' but inquiry can't quiz him on €1m bonus

Former Chief Executive of the Irish Nationwide Building Society, Michael Fingleton, arriving at the Banking Inquiry at Leinster House yesterday
Former Chief Executive of the Irish Nationwide Building Society, Michael Fingleton, arriving at the Banking Inquiry at Leinster House yesterday

Clodagh Sheehy

Former Irish Nationwide boss Michael Fingleton, the man with a €27.6m pension pot, feels he was "wronged" and "misunderstood".

Mr Fingleton, whose building society required a €5.4bn bailout by the Irish taxpayer, does not regret any of his decisions as the building society's CEO and very much regrets he is "continuing to pay the price personally" for the collapse of the financial system.

It was an absolute shock to him and a bitter disappointment that Irish Nationwide had succumbed to a cataclysmic crisis, he told the Banking Inquiry.

Mr Fingleton who was head of Irish Nationwide for 38 years up to 2009, insisted that the society was solvent on the night of the bank guarantee and it was "competitive opportunism" by Bank of Ireland and AIB to suggest that night that it should be nationalised.

At the time the society, he added, was solvent with a liquidity ratio "well in excess of the minimum requirements of the Regulator".

He justified his €27.6m pension pot by saying he had taken over personal management of the fund in the early 1990s when he became unhappy with the way it was managed.

Through investment he had increased it almost tenfold. It had only cost Irish Nationwide about €3m by his own estimation, or €4m if the view of some experts was to be taken.

Mr Fingleton would not be drawn, however, on the amount he now receives as an annual pension from the fund.

Questions about an expensive retirement watch and a €1m bonus paid to him when he left the bank in 2009 were ruled out for legal reasons by inquiry chairman Ciaran Lynch.

The former Nationwide boss said he did not regret any decision he took at Irish Nationwide, nor did he accept there were "poor lending practices".

He conceded to Pearse Doherty, however, that he regretted the loan book had become too large.

He qualified this by saying that at the time that was a "normal commercial decision based on demographics".

Mr Fingleton denied there was any bonus culture at Irish Nationwide but said performance-related pay was given. His own bonuses were determined by the Board.

In hindsight, he told Kieran O'Donnell, the bonuses for 2006/7 were "not at all" warranted.

Asked about presiding over a lender that had the single biggest bank failure in the history of the Irish state, he insisted this was only the case if the discounts applied by NAMA were accepted.

He did not accept them and would provide evidence at a future date.

He also denied that Irish Nationwide was his personal fiefdom and explained that while he was seen as the face of the society and he did promote himself, this was only because they could not afford to buy advertising at the time.

His powers, he added, were only the "normal" ones of a CEO, given by the board and approved by the Financial Regulator.

Mr Fingleton told Michael McGrath he felt he had been "misrepresented seriously" in media reports.

He calculated that 80pc of what was written about him "by certain individuals" was wrong, 10pc might be disputed and 10pc would be correct.

"Do you feel wronged" asked Mr McGrath. "I certainly, certainly do".

Mr Fingleton stepped down from INBS in early 2009. A year later the institution faced the first of two recapitalisations by the State, involving a total bailout of €5.4bn.

Irish Independent

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