Interview with Conor Lenihan… October 26, 2013Posted by WorldbyStorm in Economy, Irish Politics.
Jason O’Toole has an interview in today’s Mail with former FF Minister of State Conor Lenihan where the latter alleges that ‘AIB lied about its finances during the crisis and was ‘literally out by billions of euro’ and therefore ‘hastened the economic collapse’.
The brother of the late finance minister, Brian Lenihan, reveals that he was a go-between for his brother with the banks. He told the Mail: ‘AIB caused a number of problems for my brother as minister because, quite frankly, I think some of the people in the bank were telling what I can only describe to be utter untruths publicly about the state
Mr Lenihan held tense secret meetings with bank representatives, ‘in offices around town or in hotels in the city’, he revealed. At the time he was junior minister for integration policy, while his brother was finance minister. In his first major interview since leaving public office, the former minister of state said: ‘My brother often relied upon me to meet people that perhaps he couldn’t meet because if the minister for finance was seen talking to certain people in the banking community at that particular time people would’ve thought there was some problem with the bank. ‘So, I spent a lot of time talking to bankers on his behalf and carrying messages back and forward about what they needed to do, etc.’
The 50-year-old said some people in AIB were being misleading, adding: ‘But, of course, it was very obvious. It seemed that some people in that bank wanted to create, in a sense, a public deception about the true status of its exposure in terms of property lend- ing etc. I don’t want to be picking on AIB, I think there were a number of other banks you could mention.’ He added: ‘They were literally out by billions. The minister and key department officials were fully aware of it, as were the Central Bank. Everybody on the State side knew they were either lying, in denial or just way out in their estimates.’ However, he said there were people at executive and board level who questioned the given line.
AIB is now owned by the taxpayer, who has a 99.9 per cent share in it, after investing €20billion to bail it out after the collapse. In February 2009, the Government announced that it would bail out the bank to the tune of €3.5billion. The following September a further €3.7billion was pumped in. And the overall figure eventually ended up at €20billion. Since the bailout there have been major changes at the top in AIB after sweeping changes. However, the problems for the taxpayer remain. And the bank is still a burden on the State. Last year it recorded losses of al- most €1billion that sparked a wide range of cost-cutting measures. And in the first six months of this year there were more losses – this time for €758million – despite implementing these measures across the country.
He claims he was involved in aspects of the peace process too and when asked whether the financial side was “comparable to the crunch talks with the paramilitaries”, he answers?
‘It would’ve been a little bit like that. But, at one stage, I wouldn’t call it a peace process, I’d nearly call it a war process in the relation- ship between the Department of Finance and some of the banks. Some of the banks in the country were very slow to recognise the situation they were in. ‘The banks were both confused and to a certain extent in denial, and perhaps even lying about the levels of exposure to property lending.’ He added that ‘the banks were clutching at straws about their potential exposure’. He said: ‘I think the thing that is perhaps not understood now is that the true extent of the Irish banks’ exposure was known and understood within the Department of Finance, but the actual level in numerical terms was not very easy to assess or capture. ‘In fact, even though accountancy sweeps were done in the banks to check the levels of exposure, the actual price-tag kept going up because, you know, of some of the ways in which these banks were lending and the syndicating arrangements that were spinning out of these loans. In fact, in many cases the banks themselves couldn’t figure out what it was they had out there in terms of loans and loans to property. ‘It was a very, very extraordinary situation that you had this level of lending that was reckless and that the banks themselves couldn’t figure out what the levels of exposure were.’
There’s more, including his current job which O’Toole sets the scene for as follows:
From his plush apartment in a leafy suburb of Moscow, Conor Lenihan has a perfect view of the Patriarch’s Park. By the pond is a famous bench where, in Mikhail Bulgakov’s classic novel The Master And Margarita, two men encounter a mysterious foreigner who transpires to be the devil. Today, the affluent Patriarch’s Ponds has no shortage of foreigners — the area’s close proximity to the central business district means it’s a particularly attractive place for expatriates to settle.
Lenihan is vice president of external economic relations at the Skolkovo Foundation. A not-for-profit agency of the Russian federal state, it was set up to attract multinationals to a purpose-built technological hub in Skolkovo, on the out- skirts of Moscow. Lenihan was headhunted to oversee the venture by oligarch Victor Vekselberg. Thought to be the fourth rich- est Russian — and the wealthiest still domiciled in the country — with a fortune of €11billion, Vekselberg is the owner and president of Renova Group, a large Russian conglomerate.
He left Ireland because:
‘I felt that it was probably better for me to move out of the country because I don’t think there was a great deal of sympathy for former Fianna Fáil ministers in the immediate aftermath of the election!’ he says, only half-jokingly, when we meet for his first major interview since retiring from public life. Since emigrating, Lenihan has spent more than half his time jetting around the world to attract foreign investment into Moscow.
Is it true, as rumour has it, that Conor was asked to run in the by- election in Dublin West to contest his late brother’s seat? ‘A lot of the activists in Brian’s old constituency were pushing and urging me to stand,’ he admits. ‘To my mind, it was far too soon after the election for me to start running again. I had put 14 years in politics and at that point I wasn’t keen to get back into it. And I didn’t believe that by-election was winnable.’ So does he plan to eventually re- turn to the political fray? ‘Not in the short to medium-term. I wouldn’t consider pushing myself back on to the political stage. I think it would have to be for a very compel- ling reason or persuasive argument made by somebody else to run.’ Lenihan says that he sees himself living in Moscow for the foreseeable future but, at the same time, admits that he is open to exploring new possibilities. You never know what life will throw up — other opportunities may come my way. I think I’d find myself as an international person now rather than a person who is rooted in one country.’
And a kind word for Putin:
‘A lot of the perceptions people have about Moscow are time- dated to the Nineties when it was a hugely difficult time. The Soviet system had collapsed and the new system hadn’t established itself. There was a degree of lawlessness that is entirely absent now. ‘This has been the one reason why Vladimir Putin keeps getting re-elected — he brought Russia through some difficult years and pushed economic growth and stabilised the country.’
Whether this is Lenihan attempting to recast the past in a certain light is an open question. But interesting how so much background information is seeping out this year, isn’t it?