Anglo trial profile: John Bowe - ‘We have a big funny with Permo’
In 1990 the business was acquired by West LB and around this time he began working with corporate clients. In 1997, he left West LB and joined ABN Amro Bank. In late April 2001 he joined Anglo Irish Bank as head of debt capital markets (DCM).
This was a new sub-division of the treasury division of the bank and his role was two-fold: To attract funding from professional investors who purchased bank bonds for an agreed return, and secondly, the setting up of a team to develop business work with the approximately 350 banks worldwide Anglo dealt with.
On arrival in that role, Bowe was largely on his own and began recruiting staff both internally and externally. He reported directly to Mr McAteer.
In the summer of 2006, he was appointed to Anglo’s senior executive board, along with Matt Moran and Peter Fitzgerald. This board, chaired by David Drumm, operated at a level just below the bank’s main board and was tasked with issues around capital spend and day to day operations.
Brian Murphy became head of treasury, where Mr Bowe worked, in 2003. This was the division concerned with getting money into the bank by raising funds in the money markets.
When Mr Murphy left the bank his role was left unfilled and Peter Fitzgerald and Matt Cullen ran treasury in a collegial manner, Bowe told investigators in February 2010.
In early 2008, Bowe spoke to Mr Drumm about the possibility of him becoming the head of treasury but by October that year Mr Drumm cast doubt on what he had said.
Bowe said McAteer told him he should just report directly to him. Matt Cullen reported to Bowe and another dealer in treasury, Ciarán McArdle, reported to Mr Cullen.
Judge Nolan said Bowe was a lesser figure to the other accused in the management hierarchy. He was not a company director.
Judge Nolan told the jury that by the start of 2008, treasury was run by Cullen, Fitzgerald and Bowe, but by September, Bowe had assumed “de facto leadership of treasury”.
In September 2008, Bowe’s colleague Matt Cullen told Bowe about a conversation he had with his ILP counterpart, David Gantly, in which Mr Cullen told Mr Gantly they might be looking for more than €5bn in deposits.
He said Mr Gantly told him it wouldn’t be a problem because “you might be well be hung for a sheep as a lamb”.
The jury heard a number of phonecalls which involved Bowe and his then chief executive Mr Drumm. During one call on September 19, Mr Drumm asked Bowe about whether they had to “cash back” the “six billion from ILP” and Bowe says yes.
Three days later Mr Drumm called Bowe to tell him: “By the way, bigger picture. 30th September, even with the six billion fixes which Mr fucking Denis confirmed for me this morning… we’re fucked”.
Bowe agrees that “we’re still in a hole”. Mr Drumm then asks Bowe “Are you going to be able to bloat the balance sheet… over year end with short term inter-bank and all that sort of stuff and shove it into liquidity?”
In another call on September 29, Bowe told Mr Drumm and McAteer about the “€6bn fix” with “Permo” , explaining “what happens is the money goes round in a circle”.
He said: “What’s happening is we give the money to them and the dance here is we actually get it back in time and that’s becoming very, very tough to do”.
During this call, McAteer said “well keep going for the moment anyway”.
The following day, when the bank guarantee had come in overnight, Mr Cullen and Mr McArdle were wondering if the ILP transactions would now cease.
Around €3bn had gone over and back at this stage. Mr Cullen approached Bowe and asked him if they were still going ahead and Bowe said they were, the trial heard.
Mr Moran also testified that he was in Mr Drumm’s office on September 30 when Bowe informed the chief executive that the ILP transactions were over and suggested Mr Drumm ring Denis Casey to thank him.
On the same day Seán FitzPatrick, then chairman of Anglo, telephoned Bowe to congratulate him on his efforts on a day when the bank had experienced record inflows of cash in the wake of the guarantee.
During this discussion, Mr FitzPatrick asked Bowe if there were “any funnies” in the year-end figure.
Bowe replied: “We have a big funny with Permo.” The accused told gardaí that the term was slang used by Mr FitzPatrick and he didn’t correct it. He said: “Clearly it was an out of the ordinary trade. I believe it was an unfortunate use of words”.
