The latest report from the joint administrators of Quinn Insurance has declared it is “business as usual” while they continue to retain merchant bankers to advise them on any prospective sale of the insurance group.
The administrators also anticipate the number of redundancies required from the workforce of 2010 will be 800 and not 900 as they originally forecast.
Some 75 jobs had been retained at the insurer’s Enniskillen office when it was initially anticipated that number of redundancies would be required there and redundancies to date were made on an agreed basis, the court heard.
The third report of the administrators was presented to the President of the High Court, Mr Justice Nicholas Kearns, today who was told elements of it were confidential for commercial reasons.
Among the confidential elements was a section of the report dealing with the solvency of the insurer.
Bernard Dunleavy, for administrators Michael McAteer and Paul McCann of Grant Thornton, said the Financial Regulator had sought changes at board level across the insurer and those changes had been effected in some 19 of 20 subsidiaries.
The Regulator had also asked the administrators to address certain confidential issues and a one page synopsis of their response was being handed into the court, counsel said.
Mr Dunleavy said the administrators were keen to underline it was business as usual and their task and goal was to return the insurer to a sound commercial footing. That was "going well" and the administrators had also been able to revisit their views on the number of redundancies required.
While volumes were down across a range of policy quotations, they were not down significantly on pre-administration levels and this underlined it was business as usual, counsel added.
He also said a full time in house actuarial facility was up and running at the group.
Mr Dunleavy said merchant bankers Macquarie Capital Europe Ltd, part of the Australian based Macquarie group, had been retained to advise the administrators on any prospective sale of the insurance group. That work was proceeding and the Macquarie group had been of enormous assistance in placing the insurer in a global context.
The judge approved payments to the end of September next of fees sought by the administrators and their lawyers, which had been made subject to a peer review which found them "fair and reasonable". The fees were based on similar payments for June and the judge said he expected fees to reduce after September.
Mr Justice Kearns also stressed he was approving the fees in the particular circumstances of this unique case and they were not to be regarded as a precedent in ordinary and routine examinerships.
He was concerned the fees in this case had been cited in ordinary examinership hearings, the judge said.
Mr Dunleavy said the fees for his clients were not intended to be a precedent in other cases.
The administrators previously secured approval of the costs of some €565,000 for their work between March 30th 2010 and April 30th 2010 and liberty to invoice the company monthly up to the end of July for fees for sums not exceeding €1.8 million.
The court also permitted them pay their solicitors, MacCann Fitzgerald, some €120,000 for work between March 30th and April 30th last and further legal costs incurred since then.
They previously paid Hume Brophy PR Consultants some €50,000 for work between March 30th and April 30th last, plus €10,000 per month for any work after that. Mr Justice Kearns, who had said he did not see the need for on-going PR services, was told yesterday Hume Brophy continued to be retained but no fees had been incurred.
The Financial Regulator put the insurer into administration last March after his office discovered guarantees had been provided by Quinn Insurance subsidiaries as far back as 2005 on Quinn Group debts of more than €1.2 billion.
The regulator said the guarantees reduced the amount the firm had in reserve to protect policyholders against possible claims, putting 1.3 million customers at risk.
An investigation into breaches of insurance regulations was launched after the joint administrators were appointed. The regulator is examining breaches of solvency rules and the conduct of individuals in failing to disclose the guarantees, as well as systems failures at the company.
