Michael Noonan (Limerick East, Fine Gael)
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Question 5: To ask the Minister for Finance the action he is taking to replace directors of banks in which the State has an interest who served as directors during the development of the banking crisis; and if he will make a statement on the matter. [34225/10]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I have said previously that Ireland as a country has been let down badly by certain individuals who held senior appointments – both at executive and director level – at some of our covered institutions. Their actions and inaction have and will continue to have severe ramifications for the citizens of this country. Deputy Noonan will appreciate that it would be wrong of me to comment on cases which are subject to ongoing investigation by the relevant statutory authorities.

One of the first actions the Government took in this area was the appointment of two public interest directors to all of the major covered institutions. These appointments were persons who I am sure the Deputy would concur are of high calibre and have undertaken their roles very seriously.

Contrary to public perception, many changes at director and senior executive levels at the covered institutions have taken place. It has to be accepted that a complete turnover of all of the respective appointments at the covered institutions was neither practical nor desirable in one instant. What the Government has sought to do is to bring certainty to the operation of the Irish financial system by making progressive changes.

Since September 2008, the chairpersons and chief executives of all of the covered institutions bar one have changed. In other words, of the six principal covered institutions, five chairpersons and five of the chief executives have changed since 2008. There has also been a substantial turnover of non-executive directors over this period. In total, based on information supplied to me by the covered institutions, 43 directors have vacated their positions for a variety of reasons since September 2008 with 30 new appointments being made. In addition, some 31 senior executives have departed. The House will also be aware that arising from the actions I announced this morning further changes at board and management level will follow at Allied Irish Bank.

I am sure the Deputy will appreciate the need for people filling directorship roles to be well qualified, with appropriate skills and experience, in order to lead the institutions through the major changes that are taking place in banking.

Michael Noonan (Limerick East, Fine Gael)
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The Minister said there have been 43 resignations of directors across the covered institutions. How many of those who were there two years ago remain?

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I will have to provide that information for the Deputy and will arrange to do so. Clearly, in the case of Anglo Irish Bank no one remains. In the other banks, as I said, there has been a substantial turnover of directors.

Michael Noonan (Limerick East, Fine Gael)
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Now that the Minister has total control or a significant shareholding in all the covered institutions, what is the Government's policy on internal recruitment, as against bringing in expertise from the outside, to top levels of management?

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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It is a matter, in the first instance, for the board of the particular institution to decide what is in the best interests of that institution. Government policy is that persons of the highest competence and expertise should be appointed to senior management positions. It is a matter, in the first instance, for the board.

One matter which we should discuss on an all party basis, given the degree of State control that now exists in the banking sector, is how appointments are made to directorships in these institutions.

Michael Noonan (Limerick East, Fine Gael)
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The Minister announced this morning that the chairman and chief executive of AIB are moving on. What severance packages will apply in those cases?

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I am not aware of the severance packages that apply. That is a matter, I take it, for their contractual terms and the remuneration committees of the relevant institution.

Michael Noonan (Limerick East, Fine Gael)
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When his policy is put in place the Minister will own 95% of AIB. That is not a minor shareholding. Does he not have an interest in severance packages, especially when there have been such rows about these kinds of packages in the past?

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Ní lá fós é, a Theachta. The position is that persons have contractual rights as well.