John Lahart (Dublin South West, Fianna Fail)
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118. To ask the Minister for Finance the status of the public interest directors in each of the banks with a substantial State interest; the names of the public interest directors in each bank since 2010; and if he will make a statement on the matter. [47826/17]

John Lahart (Dublin South West, Fianna Fail)
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119. To ask the Minister for Finance the way in which the State's public interest directors report to him; if the directors reported to him with regard to the tracker mortgage issue; and if he will make a statement on the matter. [47827/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 118 and 119 together.

Currently, there is one Public Interest Director on the board of Bank of Ireland.

The date of appointment and date of resignation/cessation of office for each of the public interest directors appointed at AIB, BOI and PTSB are as follows:

*Joe Walsh ceased to be a director following his death in November 2014.

In addition Dr Michael Somers is a Government Nominee (not a Public Interest Director) appointed to the AIB board on 14 January 2010 under the terms of the NPRFC s Preference Share investment of €3.5bn in AIB of May 2009. Dr Somers was reappointed to the board of AIB in December 2015 for a further two years through the exercise of these same rights.

In terms of reporting, any company director regardless of whether or not they are a State nominated director is subject to the requirements of company law to act in what he or she believes to be the interests of the company to which they are appointed. These are the director’s fiduciary duties which are owed to the company rather than to the appointing shareholder though under the Companies Act 2014 (as amended) there is a provision allowing a nominee director to have regard for the interests of their appointer.

Accordingly, State nominated directors to the banks do not have a formal reporting relationship to the Minister or to the Department of Finance. Over the years there have been contacts between these directors and my Department but I am not aware of any particular approaches in relation to the tracker mortgage issue. 

Going forward the State has negotiated the right to appoint directors to banks in which we have a large shareholding. My officials are working on a new procedure for any future appointments to bank boards, that will address the commitment in the Programme for Partnership Government to, “Cease to appoint new Public Interest Directors to the banks, and reform the procedures for the appointment of bank directors by the State, with a view to increasing transparency in the process".

It is important to note that any new appointment procedure for bank directors needs to have due regard to the distinct differences which exist relative to appointments to State boards. These include the fact that the State is not the only shareholder in these banks, the requirements of the Central Bank/SSM Fitness and Probity Regime and the requirement to have a broad set of expertise relevant to large regulated entities in an ever more complex regulatory environment.