Business Irish

Tuesday 21 November 2017

Conlan, who borrowed heavily from AIB, 'has no money left'

Former AIB banker Tom Barry leaves court yesterday after giving evidence in the High Court action involving businessman Philip Lynch
Former AIB banker Tom Barry leaves court yesterday after giving evidence in the High Court action involving businessman Philip Lynch

Siobhan Creaton

Kildare property developer Gerry Conlan owed AIB €226.6m at the height of the property boom when he was regarded as being personally worth €190m, but now "has no money", the Commercial Court has heard.

Details of Mr Conlan's financial affairs emerged in a witness statement provided by former head of AIB's Corporate Banking unit, Tom Barry, who gave evidence on a €25m loan Mr Conlan took out with businessman Philip Lynch and his family in 2007.

The court has heard that Mr Conlan hasn't paid interest on that loan for some time and AIB is separately pursuing him for the €25m.

Mr Barry said AIB had an extensive lending relationship with Mr Conlan in 2006 and the bank had lent him hundreds of millions of euro, mostly to finance development land in Ireland.

He had €14.6m on deposit with AIB at that time and was considered by the bank to be a "satisfactory" customer since 1996.

His loans with AIB include €48m to purchase a retail warehouse Park in Naas and loans of around €50m to part finance the purchase of the European Golf Club and three adjoining residential properties at Brittas Bay, Wicklow. The court heard by 2007, when he "cut" Mr Lynch into the deal to purchase 86 acres in Waterford for €25m, AIB was reluctant to lend Mr Conlan any more money as he had hit his limit with the bank.

He needed Mr Lynch, the former chief executive of IAWS and current chief executive of One51 plc, who was worth €50m, to join him to get the loan.

Mr Lynch said he was unaware of this and believed Mr Conlan was at the time one of AIB's most-prized customers.

Mr Conlan was once one of Ireland's highest flying property developers, who walked away with his share of €315m in 2006 from the sale of 400 acres near Naas.

He also emerged as one of 10 businesspeople rounded up by Anglo Irish Bank's former chief executive, David Drumm, to buy Sean Quinn's 10pc of the bank in a last ditch attempt to stop it from imploding.

Beyond property development, Mr Conlan heads the Harlequin Health group that owns private hospitals including Mount Carmel in Dublin.

The Lynch family claim that Mr Conlan told them AIB would lend the €25m on a non-recourse basis, so if they couldn't repay it the bank could take the land back and couldn't pursue them personally.

The court heard the bank was never asked for a non- recourse loan and says the family are liable to pay their share and Mr Conlan's.

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