Results 17,581-17,600 of 27,945 for speaker:Michael McGrath
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: Can I ask how it came about that the pension reserve fund, which had been built up over many years, was to be the source of recapitalisation for AIB and Bank of Ireland?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: No return
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: Can I take you to your own witness booklet, Vol. 2 and page ... start with 59, just to show the cover page, and this is the bail-in strategy with holders of senior and subordinated debt, an NTMA paper dated 28 March 2011. So this is when the new Government were preparing the announcement on the banking strategy and the issue of burning senior bondholders as well as junior bondholders...
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: Sure.
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: So can you explain how you arrived at a proposed haircut on senior bonds for AIB, EBS and Irish Life and Permanent of 60%; Bank of Ireland senior bonds, 45%; and then Anglo and Nationwide, 63%? How did you arrive at those figures?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: Well, it says they're indicative only and are subject to negotiations with creditors-----
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: -----but then at the end, there is a clear recommendation from the NTMA to proceed. Well, the recommendation is: "... subject to a view being taken by Government [on page 64 at the bottom] on the potential implications of an adverse reaction from the external authorities and the implementation of an appropriate legal framework, immediate steps should be taken following the announcement of...
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: Yes. And do you believe that the indicative figures there of burden-sharing to the tune of €9 billion with senior bondholders was a realistic proposition and that that could potentially have been achieved?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: And did the NTMA bring in some external assistance to help in the preparation of this? Can you recall who that was?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: Okay.
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: Okay. And the figures that are there for the haircut on junior bondholders, the total is about €5.7 billion. That largely subsequently did happen. I know the previous Government imposed about €10 billion of losses on junior bondholders, the current Government about €5 billion, so that would be out of the pool which is identified there, I would imagine. Is that correct?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: So what is your understanding as to the reason why the proposed imposition of losses of over €9 billion on senior bondholders did not happen at that time?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: And was it your view that because we were in the relatively early days of a three-year programme and the NTMA would not be borrowing on the sovereign bond markets that the impact of imposing losses, even on senior bondholders, while it might have an adverse effect on bond yields, didn't really matter because we weren't in the markets? Was that your view?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: But the NTMA view at that time in March '11 was that savings of in the order of €9 billion were possible in terms of senior bondholders across the different banking institutions?
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: Okay.
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: It's not insignificant.
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: Okay. Can I take you to again, your own booklet, Vol. 1, page 63, and this relates to an approach by the Libyan Investment Authority, no less, to the NTMA in November 2010 and they were proposing to make an investment in Bank of Ireland - proposing to take a 24% stake in terms of ordinary shares from the pension reserve fund and to invest €1 billion of the pension reserve fund shares...
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: Had the NTMA done business with Libya prior to this? Were you in business with them in terms of any investments or-----
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: Sure-----
- Committee of Inquiry into the Banking Crisis: Nexus Phase (15 Jul 2015)
Michael McGrath: And did the meeting happen in Tripoli in-----