EXCLUSIVE: Former Anglo chief David Drumm apologizes, says inquiry needed on bank guarantee


Read More: David Drumm photo gallery

David Drumm first learned about the Anglo tapes when he logged on to the Irish Independent website early Monday morning in New York.

"I knew they were bad, bad, bad," he told IrishCentral on Friday.

He said he was aware such bank conversations were recorded and he especially wants to hear the similar conversations that were going on at that intense time between the other banks and the Central Bank of Ireland and the Financial Regulator.

It was a panicked time in the fall of 2008 as he relates it, when the entire foundation of the Irish economy seemed on the verge of crumbling. Threats and bluster and frustration were everywhere.

He sees a silver lining from his own perspective, that the focus will shift from the tapes to the events surrounding the disastrous government guarantee -- which he is adamant must be explained if people are to learn the whole truth about that period.

He sees the selective leaking of the tapes and the aftermath as a clear attempt to link Anglo to the creation of that guarantee. But he insists that the Anglo liquidity issue discussed on the tapes, and the guarantee decision made when Anglo was not present, are two very separate issues.

He is back in the limelight after a relatively quiet period and accepts his role as the villain but believes there is a compelling alternative narrative where everyone involved in the disastrous sequence of events at the time will receive the same scrutiny as he and his bank already have. That, he says, is what keeps him going.

(The Anglo Tapes were released last week by the Irish Independent , showing conversations between Anglo bankers including then CEO David Drumm discussing the massive banking crisis in September 2008 as it reached its zenith and Anglo was trying to stay afloat) 

Do you regret the language used on the tapes?

I accept that the tone and language used in the tapes is inappropriate and I fully understand why the excerpts published have offended many people. Listening to a recording made almost five years ago at a highly stressful and volatile uncertain time is both embarrassing and a shocking reminder of how much pressure my colleagues and I were under at that time.

However, there is no excuse for the terrible language or the frivolous tone and I sincerely regret the offence it has caused. I cannot change this now but I can apologise to those who had to listen to it and who were understandably so offended by it.

But don't the tapes accurately reflect what was going on within Anglo at the time?

The selected excerpts from tapes beg more questions than they answer. They promote and suggest an incorrect interpretation about how and why the government issued a blanket guarantee in September 2008.

As this is at the very root of the current economic problems in Ireland it is not credible that these tapes somehow explain, or part explain, the government’s reasoning for issuing the guarantee.

One has nothing to do with the other. And yet the tapes are being represented by sections of the Irish media as 'proof' that some form of misrepresentation took place on behalf of Anglo Irish Bank.

The facts do not in any way support this. The bank guarantee was issued on the night of September 29, 2008, following a meeting between the government, its officials and the chief executives and chairmen of Bank of Ireland and Allied Irish Bank who were present on the night.

So Anglo was not present?

Anglo Irish Bank was not represented and was unaware of the meeting in Government Buildings and found out about the guarantee the following morning at the same time the public was made aware through media reports. This has never been fully explained to the Irish public.

At no time did Anglo Irish Bank request the Central Bank or the Financial Regulator to ask the government to issue a blanket bank guarantee of all Irish banks' liabilities. Anglo's request was for a secured (on its loan book) loan facility of e7bn.

Anglo first became aware of the decision to issue the guarantee at the same time it was announced by the government. The bank was elated with the news because it was believed that the bank had been saved.

However, many in the bank were stunned that the government would take what some described at the time as the 'nuclear option' of guaranteeing all of the banks' liabilities instead of just protecting depositors. In order to survive the crisis, the bank would have been very grateful if they had protected depositors' money and provided the bank (and the other banks) with liquidity support to get the bank through the crisis.