Results 16,601-16,620 of 27,945 for speaker:Michael McGrath
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: Okay. So Project Atlas 1, 2 and 3 did not identify or examine any issues in relation to the underlying security underpinning the loans given to the largest borrowers of Anglo.
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: Thank you.
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: Yes. Thank you, Chair. Mr. Ahearne, you're very welcome this afternoon. Can I start by referring to your reference on page 4 of your witness statement that the late Minister Brian Lenihan had decided in autumn 2010 to wind down Anglo? So can I ask, what advice, if any, did you give to the Minister at that time to support the decision because, in parallel with that, the then management of...
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: And in your view, what would have been the consequences of going for the other option of trying to carve out a good bank from Anglo? And what would've been the ... the operational factors in that decision?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: Sure. And when the decision was announced then in early September 2010 to separate it into a funding bank as such and a recovery bank, what was the anticipated timeline for the overall wind down of Anglo was it going to 2020 at that stage, was that the plan?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: So a short-term liquidation was not considered as a viable option at that time?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: Okay, if I can take you to November 2010 and the negotiations with the troika for the bailout. Ann Nolan of the Department of Finance stated in her witness statement to this committee that IMF officials were strongly in favour of burning any unguaranteed and unsecured bonds in Anglo. This was opposed by the EU and ECB officials. In the event, she said the matter was considered at a more...
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: That was October, is it?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: So what happened then during the negotiations themselves? The IMF on the ground here in Dublin during the negotiations was still supportive. Why did it not happen?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: And did it come down to that net point in the end that if Ireland had insisted on burning senior unguaranteed bondholders there would not have been a programme, there would not have been financial assistance?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: And at that time was it only the remaining Anglo bonds that were on the table in, let’s say, November 2010, and by coming out of the guarantee at the end of September there was total of about €19.5 billion that were unsecured and were now unguaranteed and Anglo as you say was about €4 billion to €4.5 billion? So throughout October and into November was it...
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: Yes.
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: Okay. As you know, Mr. Ahearne, about €15.5 billion in total of losses were imposed on junior bondholders - subordinated bondholders. Much of this was done through liability management exercises where debt holders were asked to voluntarily sell their debt back to the banks at reduced price. Was that seen as being an entirely different issue to the senior bondholders at that time?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: The promissory note structure that was put in place back in 2010, can you explain the logic behind that structure at the time - an overall commitment of over €30 billion, over €3 billion to be paid every year for ten years or so? Can you explain why that structure was put in place and what, in your view, were the advantages of doing it that way from the State's point of view?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: But the State would still have to come up with the cash of €3 billion every year - every March.
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: Sure. How did Minister Lenihan react to the letter from Jean-Claude Trichet of 19 November 2010, which really left nothing to the imagination that emergency liquidity assistance would only be maintained if the Irish State applied for a bailout?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: In the article you contributed to the book on Brian Lenihan: In Calm and Crisis, on page 25, you mention that Mr. Lenihan discovered that senior people at the ECB were briefing market sources that the ECB was considering the withdrawal of financial support to Irish banks. So again, this would have been in November 2010. Can you elaborate on that? What was he hearing? What was he referring...
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: Okay. Can I raise the issue of NAMA, Mr. Ahearne? And you have addressed it in your witness statement and you are strongly supportive of the NAMA project. But can I put a counter-argument to you, that the NAMA project crystallised immediately losses of €42 billion on the books of the banks, which triggered a massive round of recapitalisation? Subsequently, NAMA sold on the assets...
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: Yes, but it meant that those losses had to be fully recognised at the bottom of the market.
- Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)
Michael McGrath: So, okay, the losses were there vis-à-vis the actual value of the assets.