Tuesday 21 November 2017

Dukes lashes out at TD over NAMA fraud allegations

Laura Noonan

Laura Noonan

ANGLO Irish Bank chairman Alan Dukes last night launched a stinging broadside at a Dail deputy for alleging fraud in the way the banks had dealt with the National Asset Management Agency (Nama).

The comments came the day after TD Michael McGrath accused the banks of committing fraud by giving false and misleading information to Nama.

Mr McGrath and the Public Accounts Committee (PAC) is now asking the Financial Regulator to investigate.

Mr Dukes last night said he "utterly rejected" Mr McGrath's accusations, which came after Nama's bosses told the PAC how information supplied by the banks in September 2009 had led them to believe their loan books were in drastically better health.

According to Nama chief executive Brendan McDonagh, the figures given by the banks suggested only 30pc of their loan books would have to be written off, when the actual discount applied ended up at 58pc.


The bulk of the discrepancy stemmed from the fact that the 77pc loan-to-value ratio presented was actually "much closer to 100pc", Mr McDonagh said.

As PAC committee members, including Mr McGrath, expressed shock at the inaccuracy of the figures, Mr McDonagh said he thought there were "questions to be answered" by the banks.

"The chairman and chief executive of Nama appeared to accept this allegation [of fraud]," Mr Dukes said last night.

"Mr Daly and Mr McDonagh have a public duty to set the record straight."

A spokesman for Nama last night said he had no comment to make. Mr McGrath said he had made "no specific allegations against Anglo" but that it was "appropriate" for the regulator to investigate errors in the banks' figures that could have cost the taxpayer billions.

Meanwhile, AIB, which had originally declined to comment on the fraud allegation, last night said it "believes" it has only ever given "accurate" information to the agency.

AIB's initial information informed Nama's view that a 30pc discount would be applied across all participating banks. AIB's actual discount was 58pc.


In autumn 2009 AIB also told the stock market that its discount would be "less than" the industry-wide 30pc, before a December statement said there was "no reason to believe" the bank's haircut would be "significantly outside" the 30pc range.

"Statements made by the bank were given in good faith and based on the situation at the time of publication," AIB said last night.

Bank of Ireland is vigorously standing over all its engagements with Nama. Bank of Ireland's final discount is close to 39pc, the bank initially expected a discount of close to 30pc.

"You can't say that just because the discount changed a bank lied," said one industry source, pointing to changing market conditions.

Addressing the PAC earlier in the week, Mr McDonagh said that although some changes stemmed from falling property markets, the bulk of the discrepancy was because of the loan to value issues.

A spokesman for Irish Nationwide, which ended up suffering some of the worst Nama haircuts, said the building society had put together a new management team in "late 2009" and had "co-operated fully with NAMA in the transfer of loans" to the State agency.

Irish Independent

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