Patrick Neary resigns

Finally. The head of the Financial Regulator will “retire” from January 31, 2009.

He should have fallen on his sword a long time ago.

Here is in a bizarre interview in October:

There is something odd about all of this though. Back in December, the Financial Regulator issued a statement:

The Financial Regulator became aware, following an inspection earlier this year, of matters surrounding loans from Anglo Irish Bank to Sean Fitzpatrick. While it does not appear that anything illegal took place in relation to these loans, the Financial Regulator was of the view that the practices surrounding these loans were not appropriate. As a result we continued to monitor and investigate this and as part of this process we advised Anglo Irish Bank to ensure that these loans are reported in the annual accounts for 2008.

While these matters remain under investigation, the Financial Regulator was informed today by the Board of Anglo Irish of the resignation of Sean Fitzpatrick as chairman and Mr Lar Bradshaw as director. It has welcomed the appointment of Mr Donal O’Connor as the new chairman. As these matters remain under investigation, it is not possible to comment further at this time.

But hang on a minute. Neary now says this:

I had deferred a decision about my retirement until the Report of the Committee of the Authority examining the internal communication of matters relating to loans to Directors of Anglo Irish Bank Corporation plc was concluded. So far as I am concerned, I was not advised of any such matters in early 2008 and there has been no oral, written or email escalation of these issues to me or to the Authority over the period until the matter was raised with me by the Minister on 10 December 2008.

Eh? Neary is saying he was not advised of any “such matters” until December 10. So did the Regulator know about the loans in early 2008, or did they not?

The conclusion of the report is up here

· while concerns persisted in BSD the matter was not pursued partly because a letter from Anglo went missing and partly because of the pressure on officials from the unfolding of liquidity problems in financial markets and in individual institutions;

· the Committee noted that while the pressures referred to above did not explain what occurred they are an essential part of the background;

· the issue did not surface again internally, even in Autumn 2008, when major stability and strategic issues were being addressed by the authorities including the Government;

· in relation to the particular issue of whether this matter had been mentioned to the Prudential Director and Chief Executive after a wider meeting had concluded in January 2008, the Committee was impressed with the coherence, clarity and belief in their stated recollections of the people concerned and their integrity. Nevertheless, the evidence presented to the Committee on this issue could not be reconciled by the Committee. There is no suggestion from any party that any communication – verbal or written – on this issue was made to either the Prudential Director or Chief Executive in the period (subsequent to January) to December 2008..

So the “Regulator” (as a body) knew about it. A letter went missing. People in the office of the regulator never told the chief executive about the loans…? What?