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Fingleton got €450,000 holiday pay in 'exit' deal

FORMER Irish Nationwide chief Michael Fingleton claimed almost €450,000 in holiday pay as he exited the ailing building society, the Irish Independent has learned.

Mr Fingleton was paid the sum for "untaken leave" as part of the massive €2.4m package he received from Irish Nationwide Building Society in 2008.

Details of the previously unknown payment -- the equivalent of 15 times the average industrial wage -- emerged less than a fortnight after it was announced that the state bailout of the stricken lender would double in cost to €5.4bn.

The €2.4m package also included a salary of €893,000, benefits worth €70,000 and a now infamous €1m 'bonus', which Mr Fingleton (72) pledged to pay back but subsequently failed to do so.

Details of the payment -- obtained under the Freedom of Information Act -- were included in a high-level Department of Finance memo relating to draft accounts for the building society for 2008.

The accounts included a then-unexplained payment totalling €450,000, which was simply labelled "other".

Department of Finance officials expressed concern about the payment at the time, with one stating it was "likely to raise further questions".

Sources told the Irish Independent that most of this payment related to "a massive backlog of untaken leave", which Mr Fingleton had built up over the years.

The sources said Mr Fingleton -- who retired from the building society in April 2009 after 38 years with a pension pot worth €27m -- would have had to put in a claim for the untaken leave and would not have received the payment if it had not been sought by him.

Irish Nationwide's remuneration committee approved the additional payment on April 6, 2008.

The building society declined to comment on the revelations last night.

The former banking boss was also unavailable for comment last night. There was no answer at Mr Fingleton's gated home, 'Liskilleen' in Shankill, south Dublin, and he did not return calls for comment.

Details of the additional payment angered opposition TDs.

"It is symbolic of the shameless greedy behaviour of the bank bosses who ran rings around the Government and got away scot-free," Fine Gael communications spokesman Leo Varadkar told the Irish Independent.

"Mr Fingleton stiffed Irish Nationwide for every last cent before passing the bill to the Irish nation."

The TD called for the Government to introduce a windfall tax on bankers' bonuses, gratuities and pensions.

Meanwhile, other Department of Finance records seen by the Irish Independent shed further light on the controversial €1m 'bonus' element of the €2.4m package.

A letter from Irish Nationwide's then-acting chief chairman Terry Cooney to Finance Minister Brian Lenihan last year said the sum was paid as "an incentive" to keep Mr Fingleton employed as chief executive by the building society during a time of market turmoil.

Mr Fingleton had stepped down from Nationwide's board in January 2008 as required by the institution's rules, having reached the age of 70.

Mr Cooney said the building society had considered changing its rules to remove the age bar, but this was rejected at its annual general meeting.

He said Mr Fingleton found this decision unacceptable.

"Negotiations were entered into between Mr Fingleton and (Irish Nationwide's) remuneration committee to ensure Mr Fingleton remained with the society," he wrote.


As part of the negotiations it was agreed that Mr Fingleton's salary for 2008 would be increased by 10pc from €812,000 to €893,000 and that a bonus of €1m would be paid.

Mr Cooney said the bonus "was not to be linked to performance or any further assessment".

He added: "While the amount of €1m was characterised in the minutes as a bonus, the nature of this payment was, in fact, a minimum contracted payment required to ensure Mr Fingleton remained with the society."

Mr Cooney told Mr Lenihan that the payment was agreed "in the best interests of the society given the fragile nature of the markets and account of the impact on the society had Mr Fingleton departed at that juncture".

Following public and political pressure, Mr Fingleton pledged to pay back the €1m. However, he later rowed back on this commitment and said he wanted to quietly distribute the funds to charitable causes.

Since his retirement he has divided his time between Spain and his home in Shankill. So far he has not been investigated for his role in the building society's collapse.

Former colleagues say he personally approved all the institution's significant lending.

The building society recorded losses of €2.5bn last year.

Irish Independent