Disgruntled shareholders of Irish Life & Permanent vented their anger at the bank's sliding share price yesterday by attacking recent management decisions at the company's annual general meeting in Dublin.
Chairman of the group, Mr Roy Douglas, fielded questions on policies such as the timing of last year's share buyback scheme and group chief executive Mr David Went's €74,000 salary increase.
Although the group posted a 31 per cent rise in profits to €355 million for last year, the share price slid 9.66 per cent throughout 2002. Its year-to-date appreciation is 1.26 per cent.
Despite the strong trading record of the group, particularly in residential mortgage lending, where the bank claims to hold more than 25 per cent of the market, Mr Douglas conceded this success had not been reflected in the company share price.
Addressing several hundred gathered shareholders he said: "That business success is not currently being reflected in our share price and I have to say that the current value of the shares is a disappointment to your board, as I know it is to each of you as shareholders."
Mr Douglas was also forced to admit this low share value now showed up the poor timing of the board's decision to embark on the second €150 million share buyback scheme last year.
After an angry shareholder demanded to know the highest value the board had paid for the shares, Mr Douglas admitted that with the benefit of 20:20 hindsight, buying the shares at the current rate would "have been the preferable option". But he said the stock markets had been in a "downward spiral for some time now" and maintained that the board had acted in "good faith".
The average share price paid in the buyback was €12.64, while the highest was €14.80. By the close of business yesterday, the bank's stock price was up three cents to €10.43.
Shareholders kept up the pressure on the company's chairman by questioning the €74,000 increase in Mr Went's salary to €563,000.
However, Mr Douglas robustly dismissed such questions by stating that the company had to pay competitive rates if it was to continue to retain its excellent management team.
He also signalled that there would be "testing times" ahead, particularly for the life and pensions business, if stock markets continued to fall but claimed the "sheer strength of the group and the breadth and scale" of the bank's operations meant it could respond to these challenges.
He added: "The bank really got off to a flying start this year and - as we see it at this point in the year - we expect that the strength of its performance will go a long way to make up for any shortfall in the return from the life and pensions side."
