Business Irish

Sunday 18 February 2018

Some went quietly, but others were asked to go at the double

Shane Ross, Louise McBride and Nick Webb look at the famous and infamous faces who have headed for the exit doors during the year

SO long, then. The past 12 months have seen quite extraordinary changes in business, between IMF bailouts, budgets from hell and even bigger cheques for the busted banks. It has also seen resignations, retirements and relocations for some of the most famous faces in corporate Ireland. We'll miss a lot of them but others can't have gone fast enough ... and we know where they live.


More than two years after announcing all-out war on the hundreds of state bodies and quangos that litter officialdom, less than 20 of the 41 targeted for immediate closure have actually gone.

One of these, Combat Poverty, closed its doors in the summer of 2009. The State is still paying rent of €228,000 per year plus €55,000 in costs for its unoccupied offices. The Department of Social Protection is to exercise the break clause in the office lease in March.

Other departures include the National Consultative Committee on Racism and Inter-culturalism, The National Crime Council, Coiste an Asgard and the Ireland Newfoundland Partnership. Fine Gael has promised to wield an axe through quangolia but pre-election party promises tend to vanish into puffs of smoke after polling day.

There are gallons of fat to be liposuctioned out of the state budget through shuttering quangos. An OECD report suggested that up to €13bn per year is spent through various quangos, including the biggies like HSE, Fas or CIE.

Most worrying is the fact that the Government has set up a pile of new quangos since announcing a war on waste. These include the Dublin Transport Authority, Science Museum Board and the new Judicial Review Board.


Ajai Chopra, the head of the IMF's Ireland taskforce, arrived in Dublin in December. It was the end of a week in which newsrooms around the country had been swamped by phone calls claiming sightings of well-dressed foreign looking people who were "definitely" in the IMF.

Indeed, there had been suggestions that a tall Hungarian had been working out of the Department of Finance for a couple of weeks. The Government had, of course, been telling us till it was blue in the face that we didn't need a bailout and that the IMF wasn't coming. Dermot Ahern even described suggestions as "fiction." Ouch.

Chopra duly arrived with his team and had dinner out in Glenageary while filleting government spending. The four-year plan was tweaked and tugged into shape, a budget with €3bn in cuts and tax hikes became a €6bn slasher fest. A deal with the IMF and European bailout funds was agreed and Chopra got back on the plane.

The bailout, or less catchy sounding impossible loan burden with excruciatingly high interest rates, was duly cleared by a bunch of politicians who will lose their seats in a couple of weeks. Slan leat to economic sovereignty and hello to economic servitude to our new European masters.

Charlie McCreevy

Former Finance Minister Charlie McCreevy has got off rather scot free when it comes to taking the rap for the economic meltdown.

To be fair, he was off in Brussels for the last bits of the boom. McCreevy's term as EU Commissioner for internal markets ended 12 months ago and the private sector loomed. Michael O'Leary gave him a job as a non-executive director of Ryanair. But he also landed a plum job as a board member of NBNK Investments, a company set up by top London financiers to pick up distressed financial assets and banks for half nothing.

The company floated on the London stock market, with the small print revealing that McCreevy owned a bundle of shares in the new firm ... he would also pretty much double his wages if NBNK bought anything big. Then people suddenly twigged. What was the EU commissioner formerly in charge of regulating some financial markets doing on the board of a financial services company? There was a potential conflict of interest.

Brussels decided to launch a probe into the possible problems and McCreevy stood down in a shot. It's long odds that Ryanair will be the Kildare man's only boardroom gig.

Sean Quinn

It was without doubt the worst single gamble in Irish history. Sean Quinn's decision to punt billions on Anglo Irish Bank went spectacularly wrong, decimating his €3bn plus fortune and causing his Quinn Insurance company to go into administration.

And this from a man who never bet more than 50 cent a hand when playing cribbage.

Hedge funds and other shark-like investors now hold the upper hand. Anglo lent Quinn close to €2.8bn and is desperately trying to get it back by buying the insurance group. The other parts of the 40-year-old empire ranging from glass bottles, cement, pubs and property also look to be on the block as debts need to be repaid. Quinn and his wife stood down from the main board of Quinn group in May. Is a comeback on the cards for the man once considered Ireland's most successful entrepreneur? We'd like to think so ... .but largely so the taxpayer isn't on the hook for all the Anglo debts.

Bernard McNamara

The game was up for property developer Bernard McNamara in November when Nama rejected his business plan and a receiver was appointed to his construction firm Michael McNamara.

The former Fianna Fail councillor is thought to have clocked up debts of €1.5bn on his decade-long splurge on Irish and European property. McNamara's best known assets included a stake in the Shelbourne Hotel in Dublin as well as a big slice of the disastrous Irish Glass Bottle site in Ringsend.

In recent weeks other companies in the McNamara empire have also gone into receivership, including the firm behind his landmark Elm Park development. McNamara, who lives in Ailesbury Road, has said that if he had to, he could live in a tent in Doolin, Co Clare. That day might be getting closer

Gillian Bowler

Two weeks ago, Gillian Bowler was still the last (wo)man standing since the cull of Irish bank bosses started in late 2008.

That cull began with the resignation of Anglo Irish Bank's Sean Fitzpatrick two years ago -- shortly after it emerged that he had hidden €87m in secret loans for eight years. Others to follow suit included Bank of Ireland's Brian Goggin, Irish Nationwide's Michael Fingleton and AIB's Eugene Sheehy.

As Bowler had been chairman of Irish Life & Permanent (IL&P) since 2004, she too was among the 12 chairman and chief executives at the helm of the Irish banks when the banking crisis first started to unfurl in September 2008.

Apart from EBS chief executive Fergus Murphy, who was deemed not responsible for the chaos in the Irish banks because he was a relative newcomer to the circle of bank bosses when the crisis broke, Bowler was the only one to survive the bank upheaval -- until last month, that is.

On December 14, Bowler finally threw in the towel when she told the board of IL&P that she would step down from her position as chairman next year. Bowler has insisted that the shake-up in the Irish banks had nothing to do with her decision to step down.

She almost became part of the banking cull in February 2009 when it emerged that IL&P had helped to artificially prop up Anglo's balance sheet with a €7.5bn deposit. Although Bowler said she was unaware of the transactions at the time, she offered to resign -- but this offer was refused by the board. The controversial deposit, which put IL&P at the centre of investigations by the Garda Fraud Squad, the Office of the Director of Corporate Enforcement (ODCE) and the Financial Regulator, led to the resignations of IL&P chief executive Denis Casey, finance director Peter Fitzpatrick and head of treasury David Gantly.

Bowler, who founded the tour operator Budget Travel about 35 years ago, was not the only bank director to bow out this year. Over at AIB, Colm Doherty turned out to be the shortest-lived boss the bank has ever had.

After being chosen as a highly controversial managing director in late 2009, his insider status failed to save him from an early departure in 2010. He had not been Minister Brian Lenihan's choice but the directors eyeballed Lenihan, Lenihan blinked and Doherty was given the job.

It was a short-lived victory. After a struggle to raise capital and keep AIB out of state ownership during his brief tenure in the top job, Doherty bowed to the inevitable and resigned. His exit was accompanied by the resignation of executive chairman Dan O'Connor, who had enjoyed an almost equally short period in the chair.


When Joe Higgins rings in the New Year this Friday, he had better be in the mood to move on -- with Bank of Scotland Ireland (BoSI) winding down for good that day, he will no longer be chief executive of the once bolshy bank.

Only a year-and-a-half after Higgins took over from then chief executive Mark Duffy in February 2009, Halifax --the retail arm of BoSI, announced that it would be pulling out of Ireland with the loss of 750 jobs. Halifax shut up shop last June -- and BoSI's business banking arm will be gone by the end of the week.

The retreat of BoSI this year was a far cry from the bravado it once exuded. As part of the launch of its Halifax brand in 2006, television adverts showed disgruntled rival bankers barging into one of its branches for a fight -- with one eventually being hurled through a window. The message was clear -- Halifax was here to take on the incumbents by offering us cheaper credit cards, current accounts and mortgages.

A few years later, the bank couldn't get out of Ireland quick enough after the Irish recession and property meltdown came knocking on its door. At the end of this month, BoSI will be no more -- its assets and liabilities will be transferred to its British parent, Lloyds Banking Group.

Higgins then becomes chief executive of Certus, which will manage and wind down BoSI's €32bn Irish loan book.


Trintech co-founder and chief executive Cyril McGuire will walk away with an estimated US$27m (about €20m) at the end of the year when his company is sold to a US private equity firm.

In a deal approved by Trintech's shareholders last month, Cerasus -- a wholly owned subsidiary of Spectrum Equity Investors -- bought Trintech for $129.4m (about €98m). The price tag -- only a fraction of the technology company's value at the height of the dot com boom in 2000 -- was considered by some to undervalue the company.

McGuire, who set up Trintech with his brother John in 1987, will pursue a number of opportunities in the IT area after he leaves the company at the end of this month, according to a spokesman.


Danuta Gray stepped down as head of Telefonica O2 Ireland last month, after nine years at the helm of the mobile phone company. Gray joined O2, previously Esat Digifone, in 2001. Before that, Gray had worked for British Telecom in the United Kingdom.

Gray, who continues to work as a part-time non-executive director for O2, is also a director of Irish Life & Permanent, Aer Lingus and chairperson of the Irish operation of the children's charity, the Barretstown Gang Camp.


Kyran McLaughlin retires as chairman of pharmaceutical giant Elan next month after he announced last April that he would step down once a successor was found.

McLaughlin, who will be replaced by former Glaxo Wellcome chief executive Robert Ingram, was appointed chairman in January 2005 -- only weeks before the firm's multiple sclerosis drug, Tysabri was pulled after a fatal reaction to the drug.

Elan's share price plummeted at the time but the following year, regulators allowed the drug back on the market. The temporary suspension of Tysabri would be the first of many controversies to rock Elan during McLaughlin's tenure as chairman.

Last September, the company was cleared of breaking corporate governance rules after an investigation was conducted into a series of transactions. The two dissident shareholders who made the allegations that triggered that investigation have since stepped down from the board of Elan. The 66-year-old McLaughlin is also a director of Ryanair and Davy Stockbrokers.


By the time Brendan Drumm stepped down as head of the cash-strapped Health Service Executive (HSE) last summer, he had managed to secure a basic salary of more than €370,000. Drumm was also paid €15,000 a year in lieu of a company car -- and performance bonuses of up to a quarter of his salary.

Although Drumm did not receive bonuses from 2008 onwards (following a government request in 2009 to suspend public sector bonus payments) he had already managed to bag a performance bonus of €70,000 in 2007.

Drumm also received performance bonuses for 2005 and 2006 -- the first two years of his five-year contract.

Drumm's total wage package for 2007 came to €494,000 -- at that time, the health service faced massive cutbacks, with hospitals being hit with recruitment freezes and spending cuts.

Despite his massive package, a Sunday Independent investigation revealed how Drumm and his top managers travelled the globe at the taxpayer's expense, treating themselves to luxurious hotels and business-class travel.

Since Drumm stepped down, the Government announced that the health service faced €727m in cuts next year -- cuts that will likely see more patients on trolleys, longer waiting lists, operations being cancelled, and higher charges for public and private beds.

Last August, Drumm was appointed to the board responsible for developing the new national paediatric hospital.


Cathal Goan stepped down as director general of RTE last July after deciding not to extend his seven-year contract. Goan had been with RTE since 1979, working initially in radio as a producer and moving to television in 1988 where he worked on Today Tonight.

In March 2009, Fianna Fail Dublin-North TD Michael Kennedy called on Goan to "consider his position" after RTE ran a story about fake nude portraits of Taoiseach Brian Cowen. RTE later apologised for the broadcast.

Finally, another media figure to step down this year was Maeve Donovan, managing director of the Irish Times. Donovan retired as managing director of the paper last February after eight years in the MD's role and 32 years in the company.

Sunday Independent

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