IBRC didn't trust Quinn enough to do €270m deal
Bank mulled over making €10m offer to Quinns
IBRC, the former Anglo Irish Bank believed they could recover €20m more for the taxpayer by doing a deal with the Quinn family to regain control of the family's disputed overseas property empire than in any other scenario.
During tense negotiations with the family in 2012 it is understood that IBRC felt that striking a deal with the Quinns would allow them to recover €270m by selling off their overseas assets consensually.
This is more than the €73m the bank believed it would make if it carried on alone fighting various litigations in Russia, the Ukraine and India. The bank instead chose to form a joint-venture with the Russian oligarch-controlled financial firm A1, where recovery was estimated at €250m.
The IBRC decided not to do a deal with the Quinns, even though it could potentially yield a greater return, because the bank believed the family's actions in trying to move assets away from it proved them to be untrustworthy. The bank also raised concerns that it did not know where rents worth $35m from the various property assets, which include a tower in Russia and a shopping centre in the Ukraine, had gone.
The bank also fretted that doing a deal with the Quinns would not receive political support and would send a message to other borrowers that lack of co-operation could lead to rewards.
The Sunday Independent understands that the bank mulled over making a €10m settlement with the Quinns but felt the family's actions, which saw both Sean Quinn Sr and his son Sean Quinn Jr jailed for contempt of court, made this no longer viable.
In any event, the Quinn family was unlikely to accept such a proposal and are understood to have indicated to the bank they required a settlement of over €120m in return for all sides dropping all actions against each other.
The decision to do a deal with A1 required extensive due diligence before getting the nod from IBRC's board as well as the Department of Finance. A1, which is controlled by Russian billionaire Mikhail Fridman and his business associates, went through a multi-stage vetting process.
This included global investigations firm Kroll International carrying out a full due diligence report on A1, which concluded that they were a suitable partner for a state-owned bank.
The Irish Embassy is understood to have told the bank that A1 had a reputation for having an "aggressive" business approach but operated within Russian's legal framework. A1 was also vouched for by KPMG in Russia.
Since IBRC's placing into liquidation, A1 continues to work closely with the bank's special liquidator KPMG.
A1 is understood to be making headway in both Russia and the Ukraine, both inside and outside the courts, to oust the various mysterious parties that have claimed to have some stake in the ownership of these assets.
The Quinn family have stated that these parties are not under their control or influence.