At a hearing of the Parliamentary Accountants Committee, Fine Gael’s Kieran O’Donnell said that State Street had been “looking to take the Irish State for a bit of a mug”.
Under questioning from Mr O’Donnell, it was revealed that the bank had earned between €300,000 and €400,000 a year in management fees from the NTMA while it awaited the outcome of the UK’s Financial Conduct Authorities (FCA) investigation.
The chief executive of NTMA, John Corrigan, said the fees earned were minor and had only been for passive management.
“It is a lot of money but given the nature of the mandate which was passive investment there wasn’t huge risk. I’d make the point that we took the view when we met with the committee in late 2012 that we would await the finding of the Financial Conduct Authority and the police, they have come to hand and they are pretty serious in their findings and on foot of those the fund has terminated its relationship,” he said.
Mr O’Donnell said the comments by brokers that were revealed in the FCA report, including calls by brokers to “be creative,” and “Here’s what I think we should do with our new best friends,” when referring to the NTMA, had been damaging to Ireland Inc and to the NTMA.
Apart from the State Street issue, Mr O’Donnell focused on pay levels within the NTMA. Mr Corrigan said he and his colleagues at a senior level of the NTMA had waived their entitlement to 70% bonuses for the last three years. Mr Corrigan, who earns €416,000, said there had been no decision on whether or not he would decline his bonus in 2014.
When asked to justify his salary he said, ” I didn’t decide my own salary. When I was appointed it was €490,000. It was determined by the minister of finance in line with the salaries of bank CEO,” he said.
He described the current structures of the NTMA as unwieldy. Source: The Irish Examiner.