Gray confirms he held two additional meetings with Anglo officials
To ensure that there is full information on the public record, economist Alan Gray has confirmed to The Irish Timesthat early in September 2008 Mr Sean FitzPatrick called his office and indicated that he was close to his premises and requested a short meeting. Mr FitzPatrick did not indicate the purpose of this meeting in advance.
At the meeting, Mr FitzPatrick indicated that the Irish banking sector was experiencing liquidity difficulties. Mr Gray indicated that this was well known in the market and recommended that the appropriate channel to discuss this was for Anglo Irish Bank to contact officials in the Central Bank. Mr FitzPatrick indicated that they were already informed and the meeting concluded after a number of minutes.
To Mr Gray’s surprise, late in September, possibly on the 29th, Mr FitzPatrick and Mr Drumm arrived unexpectedly at his office. When they were met, they expressed their view that due to the crisis in the international financial markets, Anglo were experiencing extremely severe liquidity difficulties – a fact which was of no surprise to Mr Gray as this was by now well known in the financial markets. Mr Gray again indicated that they should discuss this with the Central Bank officials and they indicated that this had been done. Mr Drumm had a presentation with him but did not give this to Mr Gray and he used it as brief speaking notes. They did not ask Mr Gray to take any action or make any representations to any other parties. Mr Gray then concluded the meeting which in total had lasted approximately five to 10 minutes.
Mr Gray did not discuss this with any other parties and at no stage ever made any representations of any kind on behalf of Anglo Irish Bank. Mr Gray confirms he did not discuss this with the Taoiseach, or with anybody else.
On the night of the Government guarantee, Mr Gray confirms that An Taoiseach contacted him by telephone to obtain his views as a director of the Central Bank on the likely market reaction, if a Government guarantee was introduced. In the discussion, Mr Gray raised the issue of the importance of considering State aid issues and suggested that if there was any guarantee, a fee should be charged through the banks, and that it should be time limited.
Following the nationalisation of Anglo Irish Bank, Mr Gray’s own views were in favour of the early wind down of the bank. At all times Mr Gray has acted properly in the public interest without fear or favour of any vested interest. He is non-political and is a respected independent economist. Mr Gray previously directed the radical major review of property-based tax incentives, where he recommended the wholesale abolition of these incentives which he believed were artificially increasing property prices.
As is a matter of public record, at his first meeting of the Central Bank Board, in 2007, just before the emerging crisis in the international markets, the decision was made by the board to significantly increase the capital requirements on speculative property loans in Irish banks. Mr Gray strongly supported this decision.
Mr Gray had no subsequent meetings with any officials from Anglo Irish Bank. As indicated previously, Anglo has never been a client of Indecon and neither Indecon nor Alan Gray have ever represented Anglo in any context.
While matters concerning Mr Gray’s views and contacts are normally confidential, he has decided to release the above information in the public interest.
Mr Gray will be making no further comment on this issue.