Bank of Ireland
3 July 2000
23 September 2013
24 June 2013
17 May 2013
23 April 2013
19 September 2013
Last year, the Bank of Ireland anticipated adding yet another division to its multi-faceted operation by bidding for NatWest's subsidiary Ulster Bank.
In November, the financial institution aligned itself with Irish Life & Permanent in an attempt to acquire the Northern Irish bank, which would have added to its presence in the US, Germany, Hong Kong, Jersey and the Isle of Man.
But earlier this year, the Bank of Ireland's plan to add to its asset management, life insurance and investment service businesses fell flat when Royal Bank of Scotland won a battle with Bank of Scotland to buy NatWest.
In the aftermath of the largest hostile takeover bid in UK banking history, Royal Bank of Scotland has resolved to keep and invest in Ulster Bank.
But for the moment, the Bank of Ireland is concentrating on other more pressing matters, including a large insolvency case involving construction business Hollicourt, which is due to go to appeal.
The bank is being advised by niche Leeds firm Brooke North. However, in most instances, the UK in-house legal department uses Nabarro Nathanson and Salans Hertzfeld & Heilbronn, both of which have been employed by the Bank of Ireland for a number of years.
For example, more than five years ago Nabarros acted for the Bank of Ireland when it bought half of Credit Lyonnais' personal bank accounts after the French bank decided to pull out of the sector.
Margaret O'Flanagan, who heads the legal department for Area Britain at the Bank of Ireland, says Salans undertakes most of the general banking work for the department as it specialises in asset finance consumer credit.
The provincial firms on Bank of Ireland's panel, of which there are around 30, are mainly used for litigation work.
O'Flanagan says: "Usually litigation work is a loss leader so all the fees that you pay will go to nothing. So we try to place the cases outside London."
For larger work the Bank of Ireland calls in City heavyweights Norton Rose and Slaughter and May. O'Flanagan says: "We only tend to get involved in due diligence work for major takeovers. After that it goes to external law firms."
But she says: "That can be quite frustrating, it is quite good fun doing it but I remember one instance when we were working on something doing due diligence, but then the credit department came down to tell us that the credit wasn't very good so the deal was off."
O'Flanagan was heavily involved in the Credit Lyonnais deal as she is qualified in French law; it was presumably valuable during and after the deal since the bank inherited a number of customers from across the Channel.
In terms of smaller deals, however, the legal team keeps much of the work in-house.
For example, most of the bank's business banking team have their own legal contacts so O'Flanagan and her team do not get involved in selecting the firm, although they tend to know all the firms that are used.
She says: "The panels exist for general securities matters and anything like that. Anything else is done by us. We would tend to handle anything which is very sensitive to the bank."
O'Flanagan says she has high expectations of the firms on her panel.
"I would expect them to be able to cope with whatever we throw at them and there are an awful lot of people who can't do that.
"I much prefer working with people who are well rounded and don't do just one thing - although of course if you do that then you become a lot more specialist."
She adds: "We want to know that we will get a good turnaround time. We don't expect people to drop everything, but we do expect to be treated like a valuable client.
"We want accurate advice and the knowledge that if we are dealing with a partner then it is that partner who is doing our work. We have no objection to firms using trainees but they need to be properly supervised."
Most importantly, the advice needs to be relevant. O'Flanagan says too many firms send out advice to branch managers that then has to be sent to the legal department to be broken down into usable information.
While the legal team does not tend to impose fixed fees on litigation work, it will quite often set a cap on legal fees.
"This is not the limit that can be spent," O'Flanagan says, "but acts as a guide for litigation so that if the legal fees get to, say, £5,000, we can then ask whether it is time to sort the litigation out and settle it."
The Bank of Ireland's in-house legal department is relatively small in the UK. O'Flanagan, who is a barrister by training, manages a team of three comprising of herself, a solicitor and a trainee legal executive.
But she explains that within the bank there are many legal departments that operate almost entirely separately to her own.
"ICS is our mortgage arm which has around three or four lawyers. We don't have much to do with them because Irish property law is very different to English law.
"Bristol & West is part of the Bank of Ireland group and that has about seven or eight in the legal team. On top of that we always have a group legal function that deals with strategic things like the review of the Year 2000."
Head of legal
Bank of Ireland
|Organisation||Bank of Ireland|
|European top 300 index||228|
|Market capitalisation||$6.1bn (£4bn)|
|Head of legal||Margaret O'Flanagan|
|Reporting to||Finbar Murphy, head office finance and director of legal affairs|
|Main law firms||Nabarro Nathanson, Salans Hertzfeld & Heilbronn|