An inside look at AIB during the banking crisis

THE PROMONTORY REPORT
AIB’s problems were traced all the way back to Sheehy’s predecessor as chief executive, Michael Buckley, by consultant Michael Foot of Promontory for his January 2011 report.
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Many large borrower cases came before the directors, as any time a lending limit for a big borrower was breached it went to the overall board. A subcommittee of the board was then convened to approve an increased limit.
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“The board also prized consensus, which may have made it more difficult for those who were uneasy to speak out,” he wrote.

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About 2005, Doherty, a board member at AIB, had raised concerns that big loans were being approved in the retail bank and felt that his own capital markets division, which processed big business loans, was better equipped to approve them.


Doherty raised the matter in the AIB boardroom, but his objections were seen as an internal power struggle at the bank between AIB IFSC (where capital markets was based) and AIB Bankcentre (where the retail bank was based).


He was accused in the boardroom of attempting a “land grab” for his unit and, in response, dropped the matter, despite reservations about the growth in property lending.

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