Irish Bank Resolution Corporation

Irish Bank Resolution Corporation
Fate Placed into liquidation overnight by emergency legislation
Predecessor Anglo Irish Bank
Founded 1 July 2011 (2011-07-01)
Defunct 7 February 2013 (2013-02-07)
Headquarters Ireland
Key people
 Alan Dukes (Chairman), Mike Aynsley (Group CEO)
Owner State of Ireland
Number of employees
  • Decrease0 (7 February 2013)
  • 850 (6 February 2013)
Website www.ibrc.ie

The Irish Bank Resolution Corporation (IBRC) was the name given to the entity formed in 2011 by the court-mandated merger of the state-owned banking institutions Anglo Irish Bank and Irish Nationwide Building Society.[1][2]

Formed on 1 July 2011, following a High Court order on the application of the Minister for Finance Michael Noonan,[3] the Irish government drove through overnight legislation to liquidate it in February 2013.[4]

History

Irish Nationwide Building Society had been effectively nationalised in August 2010 after receiving a €5.4bn government bailout.,[5] while Anglo Irish had been taken into state ownership in January 2009.[6] The two institutions had been widely criticised for their role in the risky lending practices which led to the Irish banking crisis.[7][8][9]

The removal of both failed banks from the Irish banking system was a key objective for the new Fine Gael-led government.[3] Finance Minister Michael Noonan made an application to the High Court[10] using his powers under the Credit Institutions (Stabilization) Act 2010, requesting that the assets and liabilities of INBS be immediately transferred to Anglo Irish Bank.

The newly merged entity was named the Irish Bank Resolution Corporation. The Finance Minister stated that the new name was important to remove the "negative international references associated with the appalling failings of both institutions and their previous managements".[3]

Liquidation

On 6 February 2013, the board of the IBRC were stood down by the Irish Government and replaced by accountancy group KPMG. Fine Gael Minister for Finance Michael Noonan introduced emergency legislation to liquidate IBRC, and replace its promissory notes with bonds with an average maturity of 27 years. Dáil Éireann began debating the legislation a few minutes after midnight on 7 February.[11]

Opposition politicians reacted with instant universal dismay and condemnation of the Fine Gael-Labour coalition's actions and the driving through of legislation during the night. Independent TD John Halligan deemed the legislation "madness", with People Before Profit Alliance TD Richard Boyd Barrett protesting, "Only 2 hours 15 mins to read & vote with no details of broader deal in Europe."[12] Independent TD Shane Ross called the showdown a "humiliation" and expressed particular concern about Section 17 of the Bill, which awards wide-ranging powers to the finance minister, while his fellow Independent TD Stephen Donnelly suggested it was "entirely plausible" that Section 17 is unconstitutional.[13] Socialist Party TD Joe Higgins described the rapid developments as "chaotic".[14] Finance Minister Noonan also made reference to the hundreds of people who were effectively sacked on live television; according to Sinn Féin finance spokesperson Pearse Doherty the workers found out they had been sacked on Bloomberg.[13][15]

The Dáil debated through the night before 7 February on emergency legislation on the future of the banking system, as the opposition criticises the hurried manner of business being enforced by the government.[16]

Reactions

The Bank of England publicly announced their own intentions to keep up unchanged amid the current financial risk ground in Britain.[17] The Governing Council of the European Central Bank (ECB) met in Frankfurt to discuss the overnight events regarding IBRC.[18] European leaders began a two-day summit in Brussels relating to the long-term EU budget.[19]

Commission of Investigation

Main article: O'Keeffe Commission

In 2015, the government proposed a motion in the Oireachtas to establish a commission of investigation into the operation of IBRC.[20][21] On 10 June 2015, it was announced that Mr Justice Daniel O'Keeffe had agreed to serve as Chairperson of the Commission of Investigation.[22][23][24][25]

References

  1. ↑ "Irish Nationwide BS Assets, Liabilities Transferred To Anglo Irish Bank". The Wall Street Journal. 1 July 2011. Retrieved 1 July 2011.
  2. ↑ "Meet Anglo 2.0... Irish Bank Resolution Corporation". The Journal. 1 July 2011. Retrieved 1 July 2011.. The names Anglo Irish Bank and Irish Nationwide Building Society (INBS) are no more after the assets and liabilities of the latter were transferred to the former with immediate effect today.
  3. 1 2 3 "Transfer Order in relation to Irish Nationwide Building Society and Anglo Irish Bank". Irish Department of Finance press release. 1 July 2011. Retrieved 1 July 2011.
  4. ↑ "IRISH BANK RESOLUTION CORPORATION BILL 2013" (PDF).
  5. ↑ "Fingleton's successor says events at INBS an outrage – The Irish Times – Tuesday, April 20, 2010". The Irish Times. 23 April 2010. Archived from the original on 9 August 2010. Retrieved 14 May 2010.
  6. ↑ "Ireland's banking crisis: timeline". The Daily Telegraph. 31 March 2011. Retrieved 31 March 2011.
  7. ↑ "Rogue banks merged into new body". The Belfast Telegraph. 1 July 2011. Retrieved 1 July 2011.
  8. ↑ "Anglo Irish Bank Renamed After 'Appalling' Past Failings". Bloomberg. 1 July 2011. Retrieved 1 July 2011.
  9. ↑ "Moody's Lowers Anglo Irish, Irish Nationwide Ratings Closer To Default". The Wall Street Journal. 24 June 2011. Retrieved 24 July 2011.
  10. ↑ IN THE MATTER OF THE IRISH NATIONWIDE BUILDING SOCIETY and IN THE MATTER OF THE CREDIT INSTITUTIONS (STABILIZATION) ACT, 2010 and IN THE MATTER OF AN APPLICATION BY THE MINISTER OF FINANCE FOR A TRANSFER ORDER IN RELATION TO THE IRISH NATIONWIDE BUILDING SOCIETY PURSUANT TO SECTION 34 OF THE CREDIT INSTITUTIONS(STABILIZATION) ACT 2010 AND ANCILLARY ORDERS – The High Court/Before Justice McGovern. 1 July 2011
  11. ↑ "Government proposes legislation to wind up IBRC". RTÉ News. RTÉ. 6 February 2013. Retrieved 6 February 2013.
  12. ↑ "As it happened: Dáil approves Bill to liquidate IBRC". The Journal. 7 February 2013. Retrieved 7 February 2013.
  13. 1 2 "Michael Noonan says IBRC action taken to secure assets". RTÉ News. RTÉ. 7 February 2013. Retrieved 7 February 2013.
  14. ↑ "Irish lawmakers vote to liquidate Anglo Irish Bank". France 24. 7 February 2013. Retrieved 7 February 2013.
  15. ↑ "Law to liquidate IBRC complete after night of high drama, as President Higgins signs it into law". BreakingNews.ie. 7 February 2013. Retrieved 7 February 2013.
  16. ↑ (The Irish Times)
  17. ↑ (The New York Times)
  18. ↑ (RTÉ News)
  19. ↑ (RTÉ) (BBC) (Channel 6 News)
  20. ↑ "IBRC investigation will cover Doherty allegations". RTÉ.ie. 10 June 2015. Retrieved 10 June 2015.
  21. ↑ "Draft Commission of Investigation (Certain matters concerning transactions entered into by IBRC) Order 2015: Motion". Dáil Éireann debates. Oireachtas. 9 June 2015. Retrieved 10 June 2015.
  22. ↑ "Dáil approves terms of reference for IBRC investigation". RTÉ. Retrieved 11 June 2015.
  23. ↑ "More IBRC revelations on the way, TDs claim". Independent.ie. Retrieved 11 June 2015.
  24. ↑ "Dáil votes to establish Commission of Investigation into IBRC". Newstalk.ie. Retrieved 11 June 2015.
  25. ↑ "Shane Ross criticises 'partisan' tribunal practices". Irish Times. Retrieved 11 June 2015.

External links

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