Fingleton Jnr snubs Central Bank inquiry into INBS ‘profit-share’ loans

MICHAEL Fingleton Jnr, who ran the Irish Nationwide Building Society office in London as the bank built a huge UK portfolio of ‘profit-share’ loans, refused yesterday to attend a Central Bank Inquiry into the high-risk practice.

Senior counsel Brian O’Moore SC said Mr Fingleton Jnr had been sent 11 written requests to help the Inquiry dating back to 2012, including four invitations over the past month to testify to the current module examining INBS profit-share loans – and had responded with silence.

“It’s simply both unfortunate and unacceptable that Mr Fingleton Jnr... has chosen not to respond or engage at all,” Mr O’Moore told the threemember Inquiry. “It’s not just the lack of courtesy, it’s the fact that as a former executive of the society, Mr Fingleton Jnr simply isn’t prepared for reasons which he has not specified to attend today, or at any other day that might be fixed for the taking of his evidence.”

The INBS Inquiry chairperson, solicitor Marian Shanley, said the probe could not compel Mr Fingleton Jnr’s attendance because he still lives outside the jurisdiction in London. Mr Fingleton Jnr’s absence yesterday lengthens the list of witness difficulties facing the Inquiry as it examines INBS’s management of profit-shares.

The loans involved advancing 100pc of the purchase value of land or property to a developer, most commonly in the UK, on terms with no security beyond the asset being acquired, and no interest or capital repayments due until the asset was sold.

Then INBS would receive 25pc to 50pc of net profits, or face full exposure if the investment soured.

The Inquiry reopened this month to news that INBS’s former managing director Michael Fingleton Snr, would not attend, citing ill health. Mr O’Moore said Mr Fingleton Jnr had communicated with the Inquiry several times in early 2019, in an effort to postpone the entire profit-share module until his father’s health improved, a legal bid rejected by the Inquiry.

Mr O’Moore noted that Mr Fingleton Jnr had engaged “with the Inquiry promptly and meeting deadlines fixed by the Inquiry” in relation to that topic, making his silence on his own attendance as a witness “striking”.

Several other figures in the bank – which collapsed in 2011 at a cost to taxpayers estimated at €5.4bn – have testified that the profit-share loans grew by late 2006 to represent most of its €8.1bn commercial loan portfolio, even though the firm had never approved or enforced any formal credit risk policy specific to profit-share agreements at all.

The Inquiry had planned to question Irish Nationwide’s other key UK-based executive, Gary McCollum, next week as its penultimate witness, before former finance director Stan Purcell, who has attended the entire module and crossexamined several witnesses.

But Mr McCollum, the former head of UK commercial lending based in Belfast, has told the Inquiry he cannot attend at any time in the coming two weeks.

Mr O’Moore proposed that the Inquiry reschedule both Mr McCollum and Mr Purcell for September “as the final witnesses, subject always to the hope that Mr Fingleton Jnr might present himself at some stage”.

Ms Shanley replied: “It’s not satisfactory, but we will proceed on that basis.”

‘It’s unacceptable Mr Fingleton Jnr... has chosen not to engage’