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Tuesday 24 April 2018

Former bank chiefs escape worst effects of meltdown

They were once the kingpins of the Celtic Tiger, lending billions as the boom spiralled. But where are they now? Siobhan Creaton investigates

Two years on from the government bank guarantee -- which expires next week -- the former bank bosses have moved on with their lives, suffering little more than status anxiety.

Some have become students, one has volunteered for the Simon Community soup run, another completed the Four Peaks challenge. Almost all are enjoying their big pensions and still playing golf with the great and the good. We examine how they are coping with the fallout and what price -- if any -- they have paid for overseeing the banking meltdown that could yet cost Ireland as much as €40bn.

  • Sean FitzPatrick (former chairman, Anglo Irish Bank)

Since his spectacular fall from grace two years ago, Sean FitzPatrick has suffered more than any other bank chief, but still hasn't been charged with any wrongdoing.

He has been interviewed by the gardai and is waiting to see whether the Director of Public Prosecutions, the Director of Corporate Enforcement or others will bring charges against him for his role in the bank's collapse.

Separately, he has been declared bankrupt because of his inability to repay his €110m debts to his former employer.

Those who know him say that, despite the perception that he is a pariah and the person being blamed for single-handedly collapsing the Irish banking system, he has had little abuse or negative interaction with the public over the past couple of years.

He continues to play golf at his local club in Greystones and has an office in the city where he has been dealing with his affairs.

He is said to continue to enjoy a close friendship with many leading business figures, who are said to be very supportive of the man that helped to finance many entrepreneurs when they were starting out and there is considerable sympathy for him in business circles.

The bankruptcy will curtail FitzPatrick's income and his movements in and out of Ireland, as his affairs will now be controlled by the official assignee appointed by the courts to administer his affairs. The bankruptcy could last for up to 12 years.

All of his financial assets are now up for grabs in the bankruptcy proceedings, including his share of the family home, his car and shares he has in various foreign properties.

His pension will also be seized but his wife Catriona could be entitled to half of his €3.4m pension fund.

  • What's he worth?

FitzPatrick has debts of more than €145m and assets of €47m and says he has a net income of €188 a month. But his wife Catriona could be worth €3m if she gets a share of his €3.4m Anglo pension pot when his assets are carved up.

  • David Drumm (former chief executive, Anglo Irish Bank)

The man who took over the day-to-day running of the bank from FitzPatrick in 2005 is currently living with his family in the US -- from where he is fighting a legal battle with hisex-employer over unpaid loans of more than €8m.

He claims that Anglo owes him almost €3m in salary, pension and deferred bonus payments. The 42-year-old Dubliner is also seeking damages, including for mental distress. Anglo has taken a legal challenge to set aside the transfer of Drumm's former Dublin home in the exclusive Abingdon development in Malahide to his wife Lorraine.

Anglo claims the transfer is a fraud on creditors but the couple, now living in Chatham in Cape Cod, claim it was for tax reasons.

Drumm returned to the US, where he ran Anglo's business before he became its chief executive, to set up a financial advisory business.

Gardai are hoping he will return voluntarily to be interviewed about a €7.5bn deposit from Irish Life & Permanent -- which concealed the extent of Anglo's losses before its collapse -- and also the €450m loan to a "golden circle" of 10 investors to buy Anglo's shares.

Drumm's representatives are believed to have held informal discussions with the Garda Fraud Squad on his behalf recently. Drumm can't be compelled to return to Ireland by the gardai and can only be extradited if he is to be charged. The Director of Corporate Enforcement is also examining practices at Anglo under Drumm's watch.

  • What's he worth?

He owes Anglo more than €8m, but is claiming the bank owes him more than €2.6m in salary, pension and deferred bonus payments. He is entitled to receive a pension of €271,000 a year from the age of 55, but this will be challenged by the bank. He failed to sell his Dublin home for €2.3m and has offered to sell a property in Cape Cod as part of a settlement with his former employer.

  • Eugene Sheehy

(former chief executive, AIB)

Eugene Sheehy has faded from the public gaze since his reign as AIB boss ended last year and is now a full-time student at NUI Maynooth. He already holds a master of science degree from Trinity College Dublin in organisational behaviour.

Since leaving AIB, Sheehy is said to have considered working for a financial institution in Saudi Arabia, although this didn't progress. He also toyed with the idea of working in the Third World.

Others said he has volunteered on the nightly soup run, providing food to the city's homeless.

He is also a keen runner. Sheehy was an AIB "lifer", having joined the bank at 19 and progressing to the top job. He was a popular figure, very much seen as "one of their own" within the bank.

Publicly, he was aloof and eschewed media interviews, and will be remembered for his arrogance in declaring that he would "rather die" than accept a cash bailout from the taxpayer.

Whether this was outright denial or bravado, the bank was eventually forced to admit the extent of its losses, triggering Sheehy's exit. As AIB's staff wait to learn whether the bank will be nationalised and how many of them will lose their jobs, they generally do not hold Sheehy to blame for their woes.

Some former colleagues at AIB believe he will re-emerge as a non-executive director when the dust settles.

  • What's he worth?

Sheehy was paid millions during his three-year reign and left AIB with an almost €900,000 payout and a pension of around €450,000 a year. He is nursing substantial losses on his AIB shares, having spent €2.8m buying the stock in 2008 that has since lost 90pc of its value.

  • Brian Goggin (former chief executive, Bank of Ireland)

Goggin left the Bank of Ireland last year after a 40-year career there. He had been chief executive for five years and received medical treatment for a heart condition after his departure.

Since then he has retired on a pension of around €650,000 a year and is not active in the business world. His time is spent between his homes in Foxrock, Dublin, and the Algarve in Portugal, where he plays golf with many of Ireland's captains of industry.

Like Sheehy at AIB, Goggin was a career banker at Bank of Ireland, but didn't enjoy great popularity among the rank-and-file. In 2008, he notoriously told RTE that he, like others in the bank, had endured pay cuts.

His salary had dropped from over €3m a year to just €2m, he told the nation in an interview that sealed his fate.

He had always been viewed within the bank as a remote figure who had little interaction with his staff and is not viewed sympathetically by them now. Bank of Ireland is the least worst of all of Ireland's financial institutions but employees are nervous about the bank's future.

  • What's he worth?

Goggin retired on an annual pension of around €650,000. His salary peaked at €3.1m in 2007.

  • Denis Casey (former chief executive, Irish Life & Permanent)

Fifty-one-year-old Denis Casey, who was forced to resign as a result of the controversial €7.5bn deposit the company gave to Anglo which concealed its losses, is now also a full-time student.

The Dubliner is in his second year of studying to become a barrister at the Honorable Society of King's Inns in Dublin. He has also taken on some financial consultancy work.

Since leaving IL&P, he has completed the Focus Ireland Four Peaks challenge, climbing four mountains in Kerry, Mayo, Wicklow and Down to raise money for the homeless.

Two of his senior colleagues, Peter FitzPatrick and David Gantly, also left the company as a result of the Anglo deposit transfer. Casey has recently given a statement to the Garda Fraud Squad but has not been questioned about the funds transfer between the two banks. That transaction is also being investigated by the Chartered Accountants Regulatory Body.

He has reportedly claimed to the gardai that the Department of Finance, the Financial Regulator and the Central Bank were aware of the transactions with IL&P before Anglo published its financial results.

  • What's he worth?

Casey, who earned more than €1m a year at Irish Life & Permanent, received a €4.6m package when he left that included a €2.9m payment into his defined-benefit pension pot.

  • Michael Fingleton (former managing director, Irish Nationwide)

Irish Nationwide's 72-year-old disgraced former boss still regularly drops into his local branch of the nationalised building society in Bray, Co Wicklow, and doesn't get much grief from customers.

Otherwise, he goes to Spain to play golf and has experienced little discomfort beyond some media intrusion.

Fingleton said he would repay a €1m bonus he received for staying on in the INBS top job after March 2009 -- even though he claims he was entitled to it and may encounter difficulties paying it back. He even suggested that he would give it to charity. The money has not been repaid to INBS.

Fingleton ran Irish Nationwide with an iron fist for decades. Staff say he approved all of the significant loans, responding on the spot to proposals and his style was to verbally sanction lending decisions rather than to give written confirmation. Its over 300 workers are among the lowest-paid in the sector and fear for their jobs. His role in Irish Nationwide's collapse is not under investigation.

  • What's he worth?

Fingleton has a healthy pension to fall back on and is entitled to €27m of the building society's total €36m pension pot.

Irish Independent

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