| 5.9°C Dublin

Bank chiefs facing share deals probe

Close

Anglo Irish Bank chairman Sean FitzPatrick

Anglo Irish Bank chairman Sean FitzPatrick

Anglo Irish Bank director Lar Bradshaw will also be the subject of an investigation by the Irish Stock Exchange into share deals which took place prior to the Government's bailout announcement

Anglo Irish Bank director Lar Bradshaw will also be the subject of an investigation by the Irish Stock Exchange into share deals which took place prior to the Government's bailout announcement

Anglo Irish Bank's headquarters in Dublin

Anglo Irish Bank's headquarters in Dublin

/

Anglo Irish Bank chairman Sean FitzPatrick

THE Irish Stock Exchange is investigating a number of share dealings in Anglo Irish Bank, including those by the bank chairman Sean FitzPatrick and fellow director Lar Bradshaw, in the run-up to the Government's decision to introduce its €400bn bailout package.

The shares were bought over a week ago, after talks had opened between banks, the Financial Regulator, the Government and the Central Bank about the state of the banking system, but before the bailout was agreed.

The transactions earned Mr Fitzpatrick a paper profit of €326,000 and Mr Bradshaw a paper profit of €79,000.

Mr Fitzpatrick bought €1.1m worth of shares in Anglo -- which lends to the commercial sector -- at €3.85. Mr Bradshaw, who is former chairman of the Dublin Docklands Authority, bought 50,000 shares at €3.92 each.

Shares in Anglo Irish increased by 18pc last night to finish at €4.90.

Both share transactions were made on Tuesday, September 23, although discussions about the state of the Irish banking sector started prior to this date.

The share deals were conducted prior to the emergency discussions which led to the Government bailout in the early hours of Tuesday.

While the Financial Regulator is the competent authority on 2005 European market abuse directive, the Irish Stock Exchange (ISE) works alongside the regulator in such cases.

Neither Mr Fitzpatrick nor Mr Bradshaw would comment on the investigation last night.

Mr Fitzpatrick was paid €431,000 for his role as chairman of the bank for the 12 months to the end of September 2007. He joined Anglo Irish in 1978 and became a director in 1985, and chief executive in 1986, before becoming non-executive chairman in 2004.

Details of the stock exchange probe emerged as the Government succeeded in getting its controversial €400m bailout passed into law yesterday.

It was signed by President Mary McAleese after the Dail and Seanad passed the bill yesterday morning, following a historic all-night debate.

Anglo Irish, whose shares tumbled 46.2pc on Monday, had borne the brunt of the collapse in confidence, and was understood to be the main focus of the high-level talks to avert a crisis in the banking system. On Tuesday, the lender's shares sky-rocketed in light of the government lifeline.

Challenge

Business Newsletter

Read the leading stories from the world of business.

This field is required

Taoiseach Brian Cowen last night challenged the banks to start loaning again to businesses, who found credit lines had closed.

"Legitimate, well-planned and costed business ideas can now, and must now, be banked.

"We did not make the move we made in order to 'prop up' an ailing system. We chose this course because we have an economy to protect and to grow," he said.

In his address to a business dinner in Trinity College last night, Mr Cowen starkly warned the banking sector that the state guarantee was not free and that a "substantial fee" would be imposed.

He described this week's major intervention as a "defining moment in our nation's history."

"We need a robust banking system. Protecting it in the manner and on the scale we have done this week is not something government does lightly," he said.

Aside from the Government parties, Fine Gael and Sinn Fein voted for the plan, but the Labour Party opposed it.

Three non-Irish owned banks, Ulster Bank, Halifax and National Irish Bank, are now applying to be included under the State guarantee.

Mr Lenihan said the activities in this country of any bank admitted to the scheme will have to be ringfenced. "That's the crucial point," he said.


Most Watched





Privacy