Irish Prime Minister Enda Kenny has ordered a government investigation into the Anglo-Irish Bank bailout after the release of secret audio recordings.
Irish officials has promised a state investigation into the ‘arrogant’ actions of Anglo Irish Bank, in which executives allegedly covered up their losses in order to secure large bail-outs from the government in the 2008-2009 financial crisis.
In them, Peter Bowe, then head of Capital Markets, can be heard telling Peter Fitzgerald, director of retail banking, that seven billion euros would not be enough to save the bank but would be sufficient to ensure further bailout money was made available.
Asked by Mr Fitzgerald how he worked out the bank needed seven billion euros, Mr Bowe said: “Just as Drummer [bank CEO David Drumm] would say, picked it out my ****, you know?… That number is seven, but the reality is we need a lot more than that…
“The strategy here is you pull them in, you get them to write a big cheque and they have to keep, they have to support their money, you know?”
In total, the failed bailout of Anglo-Irish bank, which was liquidated in February of this year, cost Irish taxpayers some 30 billion euros.
In the tapes, which were recorded internally by the bank and made public by the Irish Independent newspaper, Mr Bowe can be clearly heard making light of both the bailout application process and the bank’s ability to repay bailout funds.
He said: “If they saw the enormity of it upfront, they might decide, they might decide they had a choice… They might say the cost to the taxpayer is too high.
“If it doesn’t look too big at the outset, if it looks big, big enough to be important but not too big that it spoils everything, then you have a chance. I think it can creep up.”
Speaking on Jeff Randall Live, Paul Williams, the special correspondent at the Irish Independent said:
“We have decided to publish them because in the five years since this catastrophe, this cataclysm occurred in the Irish economy, there has been no effort made by official Ireland either the previous…or current government…to explain to the men, women and children of Ireland why their country is on its knees.”
Anglo-Irish Bank was at the centre of the Irish housing market bubble, lending billions of euros to developers during the nineties and 2000s that would never be recouped.
Mr Bowe can be heard laughing as he said: “This is seven billion (euro) bridging. So it is bridged until we can pay you back, which is never.
“So, under the terms that say ‘repayment’, we say ‘no… not applicable’.”
Both Mr Bowe and Mr Fitzgerald have released statements denying deliberately trying to mislead the Irish government’s financial regulator or abusing the guarantee of Irish banks issued by Dublin at the height of the financial crisis.
Referring on the tapes to the prospect of the Anglo-Irish Bank being nationalised, Mr Bowe says: “That would be fantastic. If it was nationalisation, we’d all keep our jobs… civil servants, you know?”