| 14.3°C Dublin

Neary 'OK' for Anglo hours before failure

DISGRACED former financial regulator Patrick Neary informed Taoiseach Brian Cowen that Anglo Irish Bank was in good health just days before the Government was forced to rescue it.

Mr Neary gave the thumbs-up to the embattled bank a mere 72 hours before the €440bn State guarantee was introduced.

He said that Anglo just had some minor day-to-day financial obligations and did not appear to be insolvent. The minutes of the crucial September 25, 2008, meeting outline that Mr Neary said he believed Anglo had enough assets to cover its debts.

Almost 50 documents related to the decision on the bank guarantee scheme were published today by the Oireachtas Public Accounts Committee.

It is understood the documentation has been partially edited by the Department of Finance for reasons of Cabinet and commercial confidentiality.

Mr Neary said at the meeting that there was "no evidence to suggest Anglo is insolvent on a going-concern basis".

Taoiseach Brian Cowen, Finance Minister Brian Lenihan, Attorney General Paul Gallagher and officials from the Central Bank and the National Treasury Management Agency were all present at the meeting on the eve of the announcement of the guarantee scheme.

New Central Bank governor Dr Patrick Honohan, in his recent banking regulation report, concluded that the financial regulator's officials and consultants hired by the State failed to spot that Anglo's toxic loan losses meant it would become insolvent.

Mr Neary headed up financial regulation and was the chief watchdog when a number of banking scandals erupted.

The secret loans of Sean FitzPatrick, the so-called "circular deposits"' between Irish Life & Permanent and Anglo, and the purchase of Sean Quinn's stake in Anglo by a "golden circle" all occurred on his watch.

clairemurphy@herald.ie


Privacy