MINISTER FOR Finance Brian Lenihan has appointed a panel of 12 individuals, including two former finance ministers and former AIB internal auditor Tony Spollen, from which the six guaranteed banks and building societies must select new board members to “promote the public interest”.
Mr Lenihan has also announced a three-person committee which under the State’s bank guarantee scheme will oversee future pay plans for senior executives at the six institutions covered by the State’s €440 billion guarantee.
The members of this committee are Vivienne Jupp, a former senior executive with consultants Accenture; former comptroller and auditor general John Purcell; and former secretary general of public service management at the Department of Finance, Eddie Sullivan.
Under the guarantee scheme, the institutions must report to the three-person remuneration oversight committee how their pay policies reflect their plans to reduce “excessive risk taking” and encourage the “long-term sustainability” of the covered institution.
The guarantee scheme also stipulates that each of the six covered institutions must appoint two board members from the panel of 12 individuals established by the Minister, subject to the agreement of the individuals and regulatory requirements being satisfied.
The panel includes Ray McSharry, a former Fianna Fáil finance minister, and Alan Dukes, who was minister for finance in 1985 when the State bought AIB’s troubled insurance subsidiary, ICI, in an effort to protect the bank.
Former tánaiste and Labour leader Dick Spring, one-time minister for agriculture Joe Walsh and Frank Daly, a former chairman of the Revenue Commissioners, are also on the panel.
Individuals from the panel will be appointed non-executive directors of the covered institutions for the duration of the two-year guarantee, which expires on September 29th, 2010, and will be paid by the respective institution.
The Minister can also appoint persons to observe all meetings of the institutions’ remuneration, audit, credit and risk committees.
Mr Spollen is an internal audit consultant and a director of the Dublin Airport Authority.
While group internal auditor at AIB in the early 1990s, Mr Spollen raised concerns about the bank’s potential liabilities to Deposit Income Retention Tax which was not being collected on bogus non-resident accounts. The leaking of the report led to the establishment of the Dáil Public Accounts Committee’s Dirt inquiry in 1998.
