NATIONAL IRISH Bank chief executive Andrew Healy has resigned after seven years in the job as the bank’s parent unveiled plans to move more than half its loans to a wind-down unit and to take greater control of the troubled Irish lender.
The NIB name will cease to exist under the changes and the continuing part of NIB will be merged with Northern Bank and rebranded as Danske this year.
The Danish bank is moving €4.7 billion of commercial and investment property loans – 56 per cent of NIB’s loan book – to the separate unit to be wound down over time. Danske said the move confirmed the group’s commitment to remain in the Irish market.
“Danske Bank has considered alternative options and decided that this solution is the best in terms of creating value for our shareholders,” said Eivind Kolding, who took over as chief executive of Danske in February.
“We have a strong competitive position in Ireland and Northern Ireland, and we intend to develop and extract maximum value.”
Mr Healy is believed to have notified Danske of his intention to resign last year and negotiated a severance pay package with Danske as part of his departure.
He is the 10th chief executive at the 11 Irish retail banks who were in place at the time of the 2008 banking crash to step down.
Fergus Murphy is still the chief executive of EBS.
NIB said Mr Healy, who will leave the bank on June 1st, had decided to leave to “consider a number of new opportunities”.
He described his time at NIB as “challenging and rewarding” and said he and the staff had “restored our bank’s reputation and come out the other side of the most difficult period in Ireland’s banking history”.
The changes were unveiled as NIB reported a loss of €184 million for the first quarter, up from €161 million on same period in 2011.
NIB took a charge of €195 million for bad loans due to further declines in property prices. This was higher than the €172 million reported in the same period last year but lower than the €218 million in the final quarter of 2011.
Danske said it expects further Irish impairments of between €670 million and €940 million until the end of 2014 and for bad debts to return to normal in 2015.
As part of a restructuring across the Danske group, the chief executive of each country’s operations will be replaced with heads of businesses reporting into Denmark.
In the new all-island structure, Northern Bank chief executive Gerry Mallon will run the personal and business banking division, and Terry Browne, head of corporate banking, will take charge of the corporate and institutional unit.
The changes are not expected to lead to further job losses among NIB’s 444-strong workforce.
The bank’s €3.1 billion commercial property loans make up most of the wind-down unit, which will be operating from January 2013.
DEPARTING BOSSES:
Chief executives in place at the time of the 2008 banking crash who have stood down:
Andrew Healy
National Irish Bank
Brian Goggin
Bank of Ireland
Eugene Sheehy
Allied Irish Banks
David Drumm
Anglo Irish Bank
Denis Casey
Irish Life and Permanent
Michael Fingleton
Irish Nationwide
Cormac McCarthy
Ulster Bank
Mark Duffy
Bank of Scotland (Ireland)
Ted Marah
KBC Bank
Rob Hartog
ACC Bank
