Photo: 60 Minutes
When Michael Lewis went to Ireland to investigate who and what brought the Irish economy to its knees for Vanity Fair, he discovered a man called Philip Ingram.At the height of the financial crisis, Ingram was an analyst for Merrill Lynch.
Ingram — spare a few online mentions for reports he wrote back in the day — isn’t a major online presence.
We know from Lewis’ article though that he’s a “quirky” 20-something, who had studied zoology at Cambridge, and who tried to warn the Irish finance ministry that the economy was about to collapse because of bad lending practices.
After which, he was basically gagged.
See, back in September 2008, Irish finance minister Brian Lenihan got into a bit of a state. He drove 45 minutes outside Dublin to visit his buddy David McWilliams, a journalist and former economist with UBS, to ask what he should do about the banks, Lewis writes.
A week after that crisis meeting, the finance department hired Merrill Lynch to advise it on the bank dilemma.
And that’s when Philip Ingram, “the bank analyst who had been most prescient and interesting about the Irish banks,” stepped into the picture.
According to Vanity Fair,
Ingram had done something original and useful: he’d shined a new light on the way Irish banks lent against commercial real estate. Ingram was sceptical of the Irish banks… To Ingram’s eyes, there undoubtedly appeared to be a vast difference between what the Irish banks were saying and what was really happening.
So he set out to find out what the real story was, and on March 13, 2008, published his findings. It was an incriminating account of the noxious methods banks were using to lend to commercial real estate, and according to Lewis, most of the report quoted word-for-word what British market insiders had told him.
According to the report, “the Irish banks were making far riskier loans in Ireland than they were in Britain, but even in Britain… they were the nuttiest lenders around.” (Apparently Anglo Irish, Bank of Ireland, and A.I.B. were the worst of all).
When Ingram released his report, it was apparently the “hottest read in the London financial markets.”
Well, it was for about two hours, because Merrill Lynch retracted it.
Merrill had been an underwriter of Anglo Irish’s bonds, as well as a broker to A.I.B. Obviously when they saw Ingram’s report, they lost it and slammed Merrill with threats that they’d be on their merry way unless something was done.
“Ingram’s superiors at Merrill Lynch hauled him into meetings with in-house lawyers, who toned down the report’s pointed language and purged it of its damning quotes from market insiders, including its many references to Irish banks.
And from that moment everything Ingram wrote about Irish banks was edited, and bowdlerized by Merrill Lynch’s lawyers.”
Finally, at the end of 2008, he was fired. Though at least now with Lewis’ piece, his efforts will be remembered.