Implosion of a legend in his own lunchtime
Seanie FitzPatrick was the brash banker who epitomised the excesses of the Celtic Tiger years. In his best-selling book The Bankers, Shane Ross charted the former Anglo chief's rise to the top from humble beginnings and his spectacular fall from grace
SEAN FitzPatrick was a little man with a little bank that became a rather big bank. A one-time colleague at Anglo Irish Bank sums him up coldly: "He suffered from the 'small man' syndrome. And like a lot of small men, he drives a big Merc." Another portrays him as south Dublin's answer to north Dublin's Charlie Haughey.
Strictly speaking, 'Seanie' was not from south Dublin. Born in 1948, he was brought up in Bray, just over the Dublin border in Co Wicklow. But his background, determination and drive bear close comparisons with the former Taoiseach.
Both men were small in stature. Both were self-made. Both cut corners. Both had strong, pushy mothers. And both became super-rich from humble beginnings. FitzPatrick's father was a small farmer. His mother had been a civil servant but devoted her life to the rearing of young Sean and his older sister, Joyce.
After a year at the Loreto Convent Bray, Sean was sent to Presentation College in the town. He was a useful and highly competitive rugby player, later lining out for Bective. He was sitting on the bench on the day when Bective scored a spectacular try. "A reporter turned to Sean the substitute and asked him the name of the scorer. 'Sean FitzPatrick' was the response."
Fitzpatrick was no star at exams. Somewhat surprisingly, in the light of his later dazzling career in Anglo, he merely managed a pass in his Leaving Certificate maths. He picked up only a single honour -- in French. Nevertheless, he squeezed into University College, Dublin, and set out to do a Bachelor of Commerce degree.
Even before he entered UCD, Sean had seen 'big money' being earned by chartered accountants and determined to become an accountant. He found a short cut to
'A reporter turned to Sean the substitute and asked him the name of the scorer. 'Sean FitzPatrick' was the response'
exam success. "The nuns were great at taking notes," he recalled. "I was the only one who'd have a cup of coffee with them and I ended up with the best set of notes in college."
In 1969, he joined Reynolds McCarron & O'Connor, a middle-ranking company. He was the only one of the trainees to be let go when finishing his articles. But his self-confidence was unaffected, and he easily found a job in another firm, joining Atkins Chirnside & Co, soon to be part of PricewaterhouseCoopers. One of his colleagues there was Charlie McCreevy, later to become Minister for Finance and a lifelong acquaintance.
"In all the years I have known him, he never lost the run of himself. He wasn't into great big houses, no jets. We used to laugh at him because he always sat at the back of the plane," said McCreevy later.
In 1976, Sean landed a job as an accountant at Irish Bank of Commerce, a publicly quoted investment bank with a tiny deposit base and just four employees. It would become Anglo Irish Bank. At last, here was his chance for the 'big money'. He grabbed it with both hands.
Initially FitzPatrick did small things to develop and grow the business. He opened at lunchtime, promoting the move by running a celebrated advertisement promoting the bank as "a legend in its own lunchtime". It was a deliberate dig at the other major retail banks, virtually none of which opened at lunchtime.
Deeply conservative and under no pressure to change their ways, the established banks continued to dictate terms to their customers rather than vice versa.
FitzPatrick was making the point that Anglo was different, new and aggressive. He poached specially selected slices of rival bank business. He didn't want current accounts, credit cards or retail business. An opportunist, he identified clients with great personal wealth and targeted them.
He became the ultimate cherry picker.
His team was taught to give quick decisions. Where AIB might take five weeks to give a loan verdict, Anglo delivered a result in five hours. FitzPatrick never promised lower interest rates or even cheaper loans, just speedy replies and less red tape.
It wasn't popular but FitzPatrick didn't care. In an interview with RTE's Aine Lawlor in late 2007, FitzPatrick recalled feeling the disdain of his counterparts at the bigger, better established banks: "I remember going to dinner parties in Dublin 4 and introducing myself as Sean FitzPatrick from Anglo Irish Bank and they'd look at me and someone from AIB or Bank of Ireland would sort of snigger . . . and I would say to my own staff coming back, the day will come when you are at a dinner party and you say you work in Anglo Irish Bank. There will be silence around the table. Why?"
But his strategy worked. Anglo grew spectacularly. Sean should have stuck to the knitting. But he couldn't. He was too often a quick-fix banker.
With success came the desire to be accepted. "It was becoming obvious to some colleagues that FitzPatrick was changing. He no longer relished the role of an outsider. The boy from Bray wanted to come in from the cold.
"FitzPatrick was beginning to sound like all those hypocritical old bankers who were running the cartel he had shunned for years. He was going native."
At the same time, he became a joiner. He was appointed a council member of the Institute of Chartered Accountants of Ireland. These navel-gazing, self-satisfied citizens of middle Ireland were honoured to welcome him into their inner sanctum, and he was equally content that he could place such dull respectability on his CV. He even joined up-market clubs such as the Hibernian United Services and became a member of other clubs with cultural pursuits. He remained an enthusiastic member of the Druid's Glen golf club, Fitzwilliam Lawn Tennis Club and was often spotted at Michael Smurfit's flashy K Club.
Golf seemed to feature more in his life. It was good for business. But it also appealed to those competitive instincts. He had a handicap ranging between 10 and 12. One regular opponent said that his golf betrayed his character. "He hated losing. He wanted to bet on every game. If he was losing, he would introduce bets on every hole to compensate. At the end of a game of golf with Sean, there could be 20 bets. He had a low boredom threshold, as much in golf as he had in business. He needed the adrenaline rush, the thrill of the holes."
All the time, the bank's loan book was growing. The same colleague observed: "But as the business grew, so did Sean's ego. Greed was never far away either."
Increasingly, Anglo's big customers were builders and developers. Ireland's construction boom was lifting the bank into a world of fantasy rewards. Anglo had stuck to its tried-and-tested methods: give quick answers and personalise the service; the difference was that the economy was booming and property was booming most dramatically of all. The rough diamonds of Ireland's building world loved the Anglo style. But it couldn't last.
During these frenzied days, a strange anomaly was emerging. Out in the marketplace during 2007, as the property bubble started to deflate and the global credit crunch kicked in, Anglo's shares fell by nearly 50 per cent. Yet in the same year, under David Drumm's leadership, profits were reported as rising. All the time, Anglo was increasing its lending to property developers. The stock market began to think they were barmy, and some observers believed that the bank was releasing fantasy figures.
Anglo was in big trouble long before anyone had heard of Sean Quinn and the Golden Circle, or of Seanie's hidden loans or even of the sham deal with Irish Life & Permanent to boost Anglo's balance sheet artificially. It was a powerful bank in the grip of one man. It was making property loans that were 'secured' by other property plays. Its loan book was dominated by a handful of favoured clients. It ignored many of the principles of corporate governance. It was paying obscene money to its current employees, its former employees, and its directors. It was a property junkie -- or, in the words of a London investment house in early 2008, "a building society on crack".
The story of the boy from Bray ended in his resignation in disgrace on December 18, 2008. Just a year and a day earlier, RTE's Aine Lawlor had asked him a telling question:
Lawlor: "This is what the other guys were running around saying about you guys: 'They're nothing but buccaneers, nothing but pirates. You know they take far too many risks and it's all going to come and topple one day'."
FitzPatrick replied: "'Will they last? Will they, they're a fine bank but will they last?' That has been said about us in the Seventies, the Eighties, the Nineties, and indeed even in recent years, but we have arrived, and we ain't going anywhere."
A year later -- almost to the day -- Seanie was gone.
'The Bankers: How the Banks Brought Ireland to its Knees' by Shane Ross is published by Penguin