Fingleton is sole beneficiary of €27.6m pension, INBS report says

IRISH NATIONWIDE confirmed for the first time in its 2008 annual report, released yesterday, that chief executive Michael Fingleton was the sole beneficiary of a €27.6 million pension scheme.

The building society said Mr Fingleton, who retires as chief executive tomorrow, also managed the scheme, which was transferred out of the society in January 2007.

A spokesman for the Financial Regulator confirmed that it was reviewing Irish Nationwide’s capital ratio after the society’s reserves fell below the 11 per cent requirement set in March 2008.

The building society’s total capital ratio as a percentage of risk-weighted assets dropped to 10.2 per cent at the end of 2008, down from 12.3 per cent a year earlier.

Capital reserves were depleted as the building society wrote off €464 million in bad loans, a ten-fold increase on the previous year, leaving it with pretax losses of €280 million for the financial year.

The building society said that it was repaid €1.7 million on the date Mr Fingleton’s pension was transferred and that its net contributions to the scheme, less the €1.7 million, totalled €3 million.

The report showed that Mr Fingleton’s remuneration rose to €2.4 million in 2008, though this included the €1 million bonus paid after the Government bank guarantee was introduced. He has since agreed to repay this money.

Mr Fingleton had loans of €1.3 million outstanding to the building society at the end of 2008, while deposits held by six directors and Mr Fingleton amounted to just under €3 million during the year.

The building society was owed €675,000 on loans owing by Mr Fingleton’s three adult children, according to the annual report.

The society said the loans were “on normal commercial terms.”

Irish Nationwide executive director and secretary Stan Purcell earned €337,000, down from €486,000 in 2007. He also received a pension contribution of €213,000 in 2008, a drop from €492,000 the previous year.

Total remuneration for directors and Mr Fingleton fell to €3.2 million in 2008 from €3.5 million.

Chairman Michael Walsh, who resigned in February, earned €100,430, the same amount he earned the previous year.

The building society said that €2.5 billion of its €4.4 billion British commercial property loan book was in London. Some €4.8 billion of the total €8.2 billion commercial property loan book was classified as “real estate renting and business.” A further €1.6 billion related to construction.