IBRC annual report for 2011 - Irish Bank Resolution Corporation ...

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Statement of Directors' responsibilitiesThe following statement, which should be read in conjunctionwith the Auditor’s report on pages 30 and 31, is made with aview to distinguishing for the Shareholder the respectiveresponsibilities of the Directors and of the Auditor in relation tothe financial statements.Irish company law requires the Directors to prepare financialstatements for each financial period which give a true and fairview of the state of affairs of the Bank and of the Group as atthe end of the financial period and of the profit or loss of theGroup for that period. With regard to the financial statementson pages 32 to 168, the Directors have determined that it isappropriate that they continue to be prepared on a goingconcern basis and consider that in their preparation:• suitable accounting policies have been selected andapplied consistently;• judgements and estimates that are reasonable andprudent have been made; and• the financial statements comply with applicableInternational Financial Reporting Standards (‘IFRS’).The Directors are responsible for keeping proper books ofaccount which disclose with reasonable accuracy at any timethe financial position of the Bank and which enable them toensure that the financial statements are prepared inaccordance with IFRS, as adopted by the European Union, andcomply with the Companies Acts, 1963 to 2009 and Article 4of the IAS Regulation. They also have general responsibility fortaking such steps as are reasonably open to them to safeguardthe assets of the Bank and of the Group, and to prevent anddetect fraud and other irregularities.The Transparency (Directive 2004/109/EC) Regulations 2007and the Transparency Rules of the Central Bank of Irelandrequire the Directors to include a management reportcontaining a fair review of the business as well as a descriptionof the principal risks and uncertainties faced by the Bank andthe Group.The Directors are responsible for the maintenance and integrityof the corporate and financial information included on theBank's website. Legislation in the Republic of Ireland governingthe preparation and dissemination of financial statements maydiffer from legislation in other jurisdictions.The Directors confirm that, to the best of their knowledge,they have complied with these requirements in preparing thefinancial statements, including preparation of these financialstatements in accordance with IFRS, as adopted by theEuropean Union, to give a true and fair view of the state ofaffairs of the Bank and of the Group as at 31 December 2011and of the loss of the Group for the year then ended. They alsoconfirm that the management reports contained in the AnnualReport and Accounts include a fair review of the developmentand performance of the business and the position of the Bankand the Group, together with a description of the principalrisks and uncertainties that they face.The Directors, having prepared the financial statements, haverequested the Auditor to take whatever steps and undertakewhatever inspections are considered to be appropriate for thepurpose of enabling the issuance of the Auditor’s report.Directors:Alan Dukes (Chairman),A.M.R. (Mike) Aynsley (Group Chief Executive),Gary Kennedy (Non-executive Director).Secretary:Philip Brady.24
Corporate governance statementIrish Bank Resolution Corporation LimitedAnnual Report & Accounts 2011The Board of Directors (the ‘Board’) is accountable to theShareholder for the overall performance of the Group. In doingso, it is responsible for:• The effective, prudent and ethical oversight of theBank;• Setting the business strategy for the Bank, followingconsultation with the Shareholder; and• Ensuring that risk and compliance are properlymanaged in the Bank.The Central Bank of Ireland’s Corporate Governance Code forCredit Institutions and Insurance Undertakings (the ‘Code’)came into effect as and from 1 January 2011 and is theprimary corporate governance code to which the Bank is nowsubject. The Code sets out a model of best practice principlesfor the governance of financial institutions and the Boardsupports and endorses the provisions of the Code, which it hasimplemented. The Bank is not classified as a major institutionfor the purposes of this code. The full text and provisions ofthe Code is available at www.centralbank.ie.The Board believes that the application of the principles in theCode also assist the Group to comply with the ethical andother considerations implicit in the 2009 Code of Practice forthe Governance of State Bodies, as published by theDepartment of Finance and also as regards adherence to theprinciples espoused in the UK Corporate Governance Code.The Bank is in compliance with the corporate governance andother obligations imposed by the Ethics in Public Office Act,1995 and the Standards in Public Office Act, 2001. The Boardis also cognisant of its collective responsibilities and those of itsindividual members under the Credit Institutions (Stabilisation)Act 2010.This corporate governance statement describes how the Bankapplied the principles of the Code throughout the year ended31 December 2011. The Directors believe that the Group hascomplied throughout the year with the provisions andprinciples as detailed in the Code.Relationship with the ShareholderIn addition to the provisions of the Anglo Irish BankCorporation Act, 2009, a Relationship Framework between theMinister and the Bank was formally approved by the Board inJune 2009. This provides the framework under which therelationship between the Minister and the Bank is governed.Under the Relationship Framework, certain key matters arereserved to the Minister, and in respect of which the Boardmay only engage on the instructions of, or with the priorconsent of, the Minister.There has been regular two way communication between theShareholder and the Board during the year on a wide range ofissues, in particular in respect of a number of key mattersregarding the strategic objective to wind down the Bank in anorderly fashion within the ongoing overall restructuring of theIrish financial system, with the Directors being kept informedof the Shareholder’s views through regular reports to theBoard by the Chairman and the Group Chief Executive andthrough meetings with the Board, Chairman, and the GroupChief Executive.Board of Directors and MembershipThe Board of Directors recognises its continuing responsibilityfor the leadership, direction and control of the Bank and theGroup and its accountability to the Shareholder for financialperformance. As at 31 December 2011, the Board comprisedthe Chairman, six Non-executive Directors and the Group ChiefExecutive. Further to the priorities referred to in last year’sstatement, the Board enhanced its existing capability and skillsthrough the appointment of two further independent NonexecutiveDirectors during the year.The Non-executive Directors are independent of management,with varied backgrounds, skills and experience.There have been a total of 35 board meetings during thefinancial year, 10 of which were scheduled. The significantnumber of unscheduled meetings were convened primarily toconsider a variety of strategic restructuring matters whicharose during the year, including the transfer of the Bank’sdeposit book to AIB, the amalgamation of the Bank with IrishNationwide Building Society pursuant to an Irish High Courttransfer order of 1 July 2011 and the disposal of the Bank’s USloan portfolio.All Directors are expected to attend each board meeting andthe attendance at board and committee meetings during 2011is set out on page 29. Directors are provided with relevantpapers in advance of each meeting. All Directors are invited toattend meetings of the Board’s principal sub-committees evenwhere they are not members of the particular committee andare provided with the relevant papers in respect of thosecommittee meetings.If any Director is unable to attend a meeting, he will stillreceive the supporting papers and will have the opportunity todiscuss any matters he wishes to raise with the Chairman toensure his views are given due consideration. During thefinancial year, many of the unscheduled meetings werearranged at short notice and it was not always possible for allDirectors to attend. The attendance rate at board andcommittee meetings for 2011 was 97%.The Board keeps a formal schedule of matters specificallyreserved for its decision. These are matters which aresignificant to the Bank because of their strategic, financial orreputational implications and include agreement of strategicobjectives, annual plans and performance targets, monitoringand control of operations, review of the performance of BoardCommittees and approval of specific senior appointments. Theschedule of matters reserved for the Board is reviewed andapproved by the Board on an annual basis, the latest reviewhaving taken place in February 2012. In addition, a formalBoard Charter is in place which governs the operation of theBoard as well as outlining the responsibilities of the Board andthe Directors. The Chairman, Group Chief Executive andCompany Secretary are always available for the Directors todiscuss any issues concerning Board meetings or other matters.Maurice Keane has been appointed as the Senior IndependentDirector.The Bank has insurance in place to cover the Directors andOfficers in respect of legal actions which may be broughtagainst them in the course of their duties. In addition, the Bankhas offered a third party indemnity to individuals who act asofficers of Bank subsidiaries or other related entities in relationto certain losses and liabilities which they may incur inconnection with their duties, powers or office.Roles of Chairman and Group Chief ExecutiveAlan Dukes was appointed as Non-executive Chairman of theBank in 2010 and in accordance with the provisions of theCode, the Board renewed this appointment during 2011.The roles of Chairman and Group Chief Executive are distinct,separate and have been agreed by the Board and aredocumented within the Board Charter.25
Page 1 and 2: Irish Bank Resolution Corporation L
Page 3 and 4: ContentsIrish Bank Resolution Corpo
Page 5 and 6: Chairman’s statementIrish Bank Re
Page 7 and 8: Group Chief Executive’s reviewIri
Page 9 and 10: Group Chief Executive’s review co
Page 11 and 12: Business review continuedIrish Bank
Page 17 and 18: Board of DirectorsIrish Bank Resolu
Page 19 and 20: Corporate Responsibility continuedI
Page 21 and 22: Principal risks and uncertainties c
Page 23 and 24: Principal risks and uncertainties c
Page 25: Report of the DirectorsIrish Bank R
Page 29 and 30: Corporate governance statement cont
Page 31 and 32: Corporate governance statement cont
Page 33 and 34: OpinionIn our opinion:• the Group
Page 35 and 36: Consolidated statement of comprehen
Page 37 and 38: Bank statement of financial positio
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Supplementary information (unaudite
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Irish Bank ResolutionCorporation Li
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