IL&P official not made aware of €7.2bn Anglo deal until months later, David Drumm trial hears
The chair of Irish Life and Permanent's audit committee was not made aware of the €7.2 billion deal with Anglo Irish Bank until months after it took place, a jury has heard.
Breffni Byrne said he would have expected it to be discussed prior to taking place, due to the size and nature of the transaction, which took place in September 2008.
“I remember there was something about it in the paper and maybe a week later on February 12, 2008 we were given the full facts,” he said.
Mr Byrne was giving evidence on day 65 of David Drumm's conspiracy to defraud trial at Dublin Circuit Criminal Court.
David Drumm accepts that the multi-million euro transactions took place in between Anglo and ILP in 2008 but disputes that they were fraudulent or dishonest.
Today Mr Byrne told Paul O'Higgins SC, prosecuting, that he was aware of increased meetings between ILP and the financial regulator as the banking crisis worsened.
The witness said the full board of ILP travelled to the Central Bank on May 1, 2008 to meet with the financial regulator.
He told Mr O'Higgins that the transaction between Anglo and ILP in September 2008 was unusual in nature as it was a cash for cash deal.
“If anything had happened it would have ended up in court,” he said.
During cross examination, he agreed with Brendan Grehan SC, defending, that ILP was upfront about the fact it accessed European Central Bank funding in 2007.
“We would certainly have disclosed to the market that we had borrowed, ” he said.
He said the Central Bank indicated they were concerned with the amount that had been borrowed, and suggested ILP diversify their funding and take less from the ECB.
Mr Grehan asked if borrowing from a lender of last resort such as the ECB would be interpreted as a weakness by the market.
“That's a difficult one. It was common knowledge at the time that banks in all countries were relying on lenders of last resort,” he said.
David Drumm (51) of Skerries, Co Dublin, has pleaded not guilty to conspiring with former bank officials Denis Casey, William McAteer, John Bowe and others to defraud depositors and investors at Anglo by “dishonestly” creating the impression that deposits in 2008 were €7.2 billion larger than they were.
The former Anglo Irish CEO has also pleaded not guilty to false accounting on December 3, 2008, by furnishing information to the market that Anglo's 2008 deposits were €7.2 billion larger than they were.
The trial is now in its thirteenth week and continues before Judge Karen O'Connor and a jury of ten men and four women.
