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Funding plan grew €1bn to €7bn, former Anglo exec tells Drumm trial
Summary
During the trial of David Drumm, former Anglo Irish Bank executive Brian Lynch testified that the plan to cover a funding shortfall grew from €1 bn to €7 bn in the weeks before the bank's year‑end. Lynch said Drumm had aimed for a year‑end deposit figure of €55–56 bn, with a shortfall of about €7 bn. He explained that the only viable funding option left was a deal with Irish Life Assurance (ILP), which involved transferring money to ILP's banking arm in exchange for corporate deposits that would improve the bank's balance sheet. Lynch first learned of the deal in August 2008, when the target figure was €1 bn, and by mid‑September it had risen to €7 bn. He also noted that Drumm had asked for an ad‑hoc liquidity report in October 2008, which the Central Bank did not challenge. The trial continues with Judge Karen O'Connor and a jury. David Drumm pleaded not guilty.
Who, what, where, when and why
What: Report matter: Funding plan grew €1bn to €7bn, former Anglo exec tells Drumm trial. Charges or matters: conspiring with former bank officials Denis Casey, William McAteer, John Bowe and others to defraud depositors and investors at Anglo by "dishonestly" creating the impression that deposits in 2008 were €7.2 billion larger than they were; false accounting on December 3, 2008, by furnishing information to the market that Anglo's 2008 deposits were €7.2 billion larger than they were Mr Lynch said that despite the "pretty bad times" at Anglo in 2008, Mr Drumm had indicated that he wanted a year end figure of €55/56bn in customer deposits. Procedural stage: trial
When:
- December 3, 2008 Other
- September 2008 Hearing Or Sentence
- August 2008 Other
- October 2008 Hearing Or Sentence
- September 30, 2008 Other
- 25 September 2008 Other
- 2018-02-15 Publication
Why: The reason for the transaction, he said, was that money from ILA would be treated as a corporate deposit on the balance sheet, so it would make the corporate deposit numbers better. CNI source report
Case subjects
Defendant
Charges: conspiring with former bank officials Denis Casey, William McAteer, John Bowe and others to defraud depositors and investors at Anglo by "dishonestly" creating the impression that deposits in 2008 were €7.2 billion larger than they were; false accounting on December 3, 2008, by furnishing information to the market that Anglo's 2008 deposits were €7.2 billion larger than they were Mr Lynch said that despite the "pretty bad times" at Anglo in 2008, Mr Drumm had indicated that he wanted a year end figure of €55/56bn in customer deposits (Alleged Or Contested)
Plea: Not guilty
Places mentioned
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