John Moran, the Irish central bank’s head of wholesale bank supervision, has been temporarily transferred to the Finance Ministry to advise on shrinking the balance sheets of debt-laden lenders.
A former executive with Zurich Financial Services AG (ZURN)’s capital markets and Zurich Bank units, Moran joined the Dublin- based central bank in July. Among his functions was to lead a review on how Irish banks, heavily reliant on central bank funding, will be deleveraged, a spokeswoman for the bank said.
Moran, 44, will help the Finance Ministry “deal with the bank restructuring agenda and various associated issues,” according to an internal memo circulated in the ministry this week. A ministry spokesman verified the contents of the memo.
As part of its 85 billion-euro ($120 billion) bailout in November, Ireland agreed to shrink the country’s banks by selling assets. The nation’s so-called viable lenders, including Bank of Ireland Plc, Allied Irish Banks Plc (ALBK), Irish Life & Permanent Plc and EBS Building Society, need to cut their loan- to-deposit ratios to 123 percent from 170 percent, according to Irish Finance Minister Michael Noonan.
Moran’s move to the Finance Ministry “is a signal that the government is looking to put a strong focus on coordinating various arms of the state, from the department to the National Treasury Management Agency and the central bank, to dealing with the banking problems,” said Frank O’Dwyer, chief executive officer of the Irish Association of Investment Managers.
It marks the first key appointment to the ministry since Noonan was named finance minister this month. Noonan and Moran weren’t available to comment, a spokesman said today.
Irish-based lenders’ reliance on short-term European Central Bank cash soared 38 percent to 116.9 billion euros in the year through February, while their dependence on the Irish central bank jumped almost fivefold to 70.1 billion euros.
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