Sunday 25 February 2018

Lucrative pension and a plum job – where the regulators are now

Former Regulator Patrick Neary. Photo: Collins
Former Regulator Patrick Neary. Photo: Collins
Con Horan at Dublin Circuit Criminal Court
Donal O'Donovan

Donal O'Donovan

Patrick Neary

AS chief executive of the Irish Financial Services Regulatory Authority, Patrick Neary was the country's top banking regulator in 2008. His job was to oversee the entire banking and insurance sector.

Before the Anglo trial, Mr Neary was probably best known for an October 2008 appearance on RTE's 'Prime Time' where he had tried to assure the public of the "stability" of the Irish banking sector – swathes of which would be nationalised over the following months and years.

His already tarnished reputation with the public is likely to have been further damaged by the evidence he gave over two days at the Dublin Central Criminal Court – in particular his inability to remember some potentially key information – something that was commented on by Judge Nolan yesterday.

The Central Bank veteran retired from that role in 2009 – and received a €630,000 pay-off as well as a pension that initially worked out at €143,000 a year.

Like other public sector retirees, Mr Neary has seen his income hit since then as the State struggled to cope with the costs of the economic crash.

Even the €24,000-a-year pension cut that he has been hit with since retiring leaves Mr Neary with an annual income of around €119,000 – three times the average wage.

The retirement itself came two years before his contract was up and followed publication of a report highlighting "communications gaps" at the regulators under Mr Neary's watch.

The former top official has aged visibly since leaving office. At the trial, he gave probably the best insights we've yet seen of just how regulation worked in practice in the period before the banking crash.

He told the jury that when the banking crisis struck, he had no way of finding out about businessman Sean Quinn's problematic stake in Anglo Irish Bank, for example, but admitted he had not asked the then tycoon about it when they met in January 2008.

He didn't feel it was "fair or appropriate" to tackle a person about their private portfolio, Mr Neary told the court.

He explained that as late as March 2008 he simply had no concerns about the stability of Anglo Irish Bank – though we now know the doomed lender was months from a potential collapse and its losses have cost taxpayers more than €30bn.


THE number-two man at the Financial Regulator in 2008 was Con Horan. Today he has a senior job representing the Central Bank at the European Banking Authority (EBA).

Like his then boss Patrick Neary, Mr Horan gave evidence at the trial of the three former Anglo Irish Bank directors – the first time he had publicly discussed any aspect of his role in the events leading up to the banking crash.

As Prudential Director of Irish Financial Services Regulatory Authority in 2008, Con Horan had hands-on responsibility for the supervision of banking, insurance and markets.

In his evidence at the Anglo trial, Mr Horan provided probably the fullest picture yet of just how closely involved regulators were in the desperate efforts by Anglo Irish Bank executives to untangle Sean Quinn's dealings with the bank – including frequent interaction with top bankers like David Drumm.

In his summing up yesterday, Judge Nolan noted that Mr Horan had tried his best to recall the events of the period – though during the trial itself Sean FitzPatrick's defence lawyers had noted the relative lack of notes kept by Mr Horan at the time.

A career public servant, Mr Horan joined the Central Bank in 1979. Unlike his former boss, Mr Horan has not retired, and has not officially left the Central Bank.

In 2009, after Mr Neary was replaced as Financial Regulator by outsider Matthew Elderfield, the Central Bank appointed Con Horan to a new role as his special adviser.

Two years later, in 2011, he was seconded to a senior job as a "national expert" at the London-based EBA.

That initial two-year appointment was extended in 2013. The EBA is one of the main bodies overseeing the move towards banking union in Europe – the most important EU policy response aimed at preventing a future banking crash.

The EBA is in charge of this year's Europe-wide bank "stress tests", which will probe the health of the banking sector and which published its long-awaited criteria yesterday.

A Dublin native, Con Horan is a qualified chartered accountant.

Last night, a Central Bank spokeswoman refused to answer questions about any concern the institution may have about his role in light of Judge Nolan's comments.

Irish Independent

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