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Sunday 1 October 2023 Dublin: 17°C
# Banking Inquiry
Former Irish Nationwide CEO Michael Fingleton tells Banking Inquiry that he feels "wronged"
“I feel misrepresented deputy. 80% of what has been written about me is wrong. 10% might be disputed.”

Updated 13.20

8993 Fingleton Leah Farrell Fingleton arriving at the inquiry this morning Leah Farrell

FORMER IRISH NATIONWIDE Building Society (INBS) chief Michael Fingleton has been up in front of the Banking Inquiry this morning.

Looking slightly frail and labouring over his words, a nevertheless bullish (probably the most spiky witness since Charlie McCreevy in fact) Fingleton told the committee that he regretted the economic crash for the sake of his employees, the taxpayers and the state.

“I continue to pay the price personally as a result,” he said.

I don’t regret any of the decisions I took personally.

In a long opening statement Fingleton claimed that he brought Irish Nationwide into the commercial property market in the early nineties as there “was a shortage of property in Ireland at the time”.

He continued to apportion blame for the economic crash to many different agencies – Bear Stearns, Lehman Brothers, ratings agencies.

“I believe the society was a victim of the property market crash in the United States,” he said.


Fingleton insisted that a bonus culture didn’t exist at Irish Nationwide, although bonuses were obviously paid.

“Those bonuses were too high. If it was today, those bonuses wouldn’t be paid, that’s all I will say,” he said.

For the record, I didn’t decide my own bonuses.

Fingleton defended the €27.6m pension pot he received from the society in 2007, saying that he had grown the pot personally ten-fold, with the actual cost to the society being just €3 million.

When asked by Sinn Féin’s Pearse Doherty whether or not a disproportionate level of risk autonomy when it came to loan approval was afforded him Fingleton replied that that wasn’t true.

He also denied that he had ever approved a loan for an individual via a message on a post-it note.

pd1 Pearse Doherty

“As CEO or managing director you’re always ultimately responsible for what takes place in the organisation,” he said.

I don’t accept that there were poor lending practices, and maximising the value of the society was not a motive (behind those practices).

No recourse

Fingleton asserted that the huge number of non-recourse UK loans (ie with no onus for repayment) at the society was dictated by the large percentage of profits being directed to the building society by developers in the UK.

He acknowledged that this was a contributory factor to the crisis but claimed it was not the dominating factor.

Fine Gael’s Kieran O’Donnell pressed Fingleton on a meeting held between INBS and the then financial regulator on 7 September 2014, a meeting Fingleton didn’t attend due to “other engagements”.

“The meeting took place as the regulator was worried about a possible run on INBS at that time,” Fingleton said.

They wanted to know if the other banks would supply emergency liquidity.
At that time we did not need liquidity.
I certainly do believe that INBS was solvent the night of the banking guarantee.

kod Kieran O'Donnell

O’Donnell asked him whether or not he considered the €5.4 billion bailout incurred by INBS as the greatest banking failure in the history of the Irish state.

“If you accept the discounts applied by NAMA then yes, but I don’t accept those discounts,” Fingleton replied, whose answers seemed to be getting more contemptuous as the hearing dragged on.

Following a blocked question (blocked by committee chairman Ciaran Lynch) regarding the €11,000-value watch Fingleton received as a retirement gift, the questioning moved to whether or not he ever authorised a loan without the approval of his board.

He denied this was the case.

Chairman Lynch then reminded Fingleton that he was under oath, which seemed to alter the tone of his answers somewhat in the immediate aftermath.

The overall tone of Fingleton’s answers was one of open dispute – he didn’t accept most of the accusations put to him and suggested at every available juncture that someone else was to blame.


Senator Susan O’Keefe attempted to bring up the issue of Fingleton’s infamous €1 million bonus which was initially awarded two months after the introduction of the bank guarantee in September 2008.

Again the question was quashed by Lynch citing legal advice.

INBS profit before tax increased by 300% in 2007 – did Fingleton think such growth was sustainable asked Fine Gael’s John Paul Phelan.

“It probably couldn’t be sustained, but we were operating within the parameters set out by the regulator at the time,” he replied.

JPP John Paul Phelan

Fingleton denied that the pursuit of growth was affecting credit quality.

“Not really, we were dealing with customers who we’d known for 15 years, customers who knew their business,” he said.

Questioning then moved once more to the size of the board at INBS and problems with corporate governance as outlined by the financial regulator in a letter from 2004.

“I was suffering from the perception that was out there that it was me, and me alone, who represented the society,” said Fingleton.

We did try to increase the board but at the time we were being sold, and recruiting proved very difficult, given the perception of us in the market at the time.

Fingleton added that INBS had been responsible residential lenders in comparison to other banks.

“We didn’t do any tracker mortgages, and only a fraction of our mortgage lending was over 90% of value,” he said.


Sligo senator Marc McSharry then pressed Fingleton on his own personal investments and dealings with INBS.

Fingleton stressed that he always maintained a deposit account with the society, and any loans he received were processed via the “usual channels, with no concessions”.

He confirmed that in such dealings he had associations with one outside party, who was a politician. He declined to name who that person was.

When Fingleton persisted with certain cynical utterances regarding NAMA and their portfolio, senator Michael Darcy put it to him that he was “swimming against the tide” when it comes to certain opinions that are seen to be accurate at this stage.

darcy Michael Darcy

“I’m just expressing my opinon, senator, it is the first opportunity I have been afforded to do so,” was the reply.

Darcy followed up with a question regarding the so-called ‘warehousing’ of loans at the society – a question that was promptly shot down once more by Lynch citing the committee’s legal briefing.


“Do you feel you have been wronged, Mr Fingleton?” asked Fianna Fáil’s finance spokesman Michael McGrath.

“I feel I have been misrepresented deputy,” a noticably irritated Fingleton replied.

80% of what has been written about me is totally wrong. 10% might be disputed.

Fine Gael’s Eoghan Murphy asked Fingleton about troubles the INBS encountered in having deposits placed with the institution by the NTMA.

Fingleton insisted the reason was because the society didn’t have an AAA rating from the ratings agencies.

When asked further why  this was the case he replied “we had adequate ratings for our business”.


Coming to the end of his testimony Fingleton was becoming increasingly tetchy in his responses.

Asked by senator Seán Barrett about losses made by the society in 2008 he replied that no losses were realised. When pressed as to whether or not INBS was struggling to locate a buyer at the time Fingleton replied “what has that to do with liquidity deputy?”

Summing up

As the session drew to a close, chairman Lynch pressed probably the most direct question of the day on Fingleton.

“Going by your testimony you don’t seem to believe you have done anything wrong. That being the case, can you explain to me how your institution ended up costing the state €5.4 billion?” he asked.

“I have not excused myself from anything,” Fingleton replied, after a brief moment where he seemed desperately to be gathering his thoughts.

I have answered all questions to the best of my opinion and given my opinion as asked.


Fingleton’s appearance stands as possibly the most anticipated of all the committee’s witnesses given his former status as CEO of the doomed society.

He was chief of Irish Nationwide until 2009, a year before it emerged the building society required a government bailout that eventually totalled €5.4billion.

It was later folded into the Irish Bank Resolution Corporation (IBRC) alongside Anglo Irish Bank.

Irish Nationwide provided loans for high-profile figures including Minister for Finance Charlie McCreevy and Celia Larkin, ex-partner of Bertie Ahern.


After the summer break, the inquiry is back in business and will resume public hearings by meeting with Fingleton and two other former Irish Nationwide executives, Michael Walsh and John Stanley Purcell.

A qualified chartered accountant and barrister, Michael Fingleton joined the building society in 1971.

Questions asked

Chairman Ciaran Lynch TD said that Fingleton and Walsh “will be asked to give evidence on a number of lines of inquiry”, including:

  • The composition, skills and experience of the board and board subcommittees
  • The quality of the business model setting process
  • The adequacy of board oversight over internal controls to ensure risk is properly identified, managed and monitored
  • The appropriateness of property-related lending strategies and risk appetite
  • The appropriateness of credit policies, delegated authorities and exception management
  • The adequacy of the incentive and remuneration arrangements to promote sound risk governance
  • The impact of shareholder or lending relationships in promoting independent challenge by the board and/or executives

They may also be asked about the appropriateness of the bank guarantee decision; the decision to recapitalise Anglo, AIB, Bank of Ireland, EBS, Permanent TSB and the alternatives available and/or considered; and the appropriateness of the regulatory regime.

Other lines of enquiry include:

  • The effectiveness and appropriateness of the supervision policy and powers
  • The nature and appropriateness of the relationship between the Central Bank including the Financial Regulator, the Department of Finance and the banking institutions
  • The appropriateness of the relationships between Government, the Oireachtas, the banking sector and the property sector.

Purcell will be questioned along similar lines, but in addition will be asked about liquidity risks, financial reporting, valuation policies and loan security.

Full committee proceedings will be webcast live ,while Oireachtas TV will broadcast proceedings from 9.30am.

Additional reporting Aoife Barry

Read: David Drumm’s statement to the Banking Inquiry will NOT be published – yet>

Read: Cowen and I don’t meet much, people might think we’re up to no good – Fintan Drury>

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