Former Davy CEO departs boards amid bond scandal fallout

Board departure: Tony Garry, then-CEO of Davy (left) answers a question at the launch of the Davy Direct share-dealing service in 2000 while Bank of Ireland's Des O'Reilly looks on. Photo: Tony Gavin.

Jon Ihle

March 16 2021 02:30 AM

Former Davy Group chief executive Tony Garry has resigned as chairman and director of BES Management, a joint venture between Davy and BDO for managing investments under the Employment and Investment Incentive Scheme (EIIS).

He departed the board of the company on March 8, just six days after Davy was fined €4.13m and reprimanded by the Central Bank for a controversial 2014 bond deal in which he participated. His resignation was confirmed by a spokesperson for BES.

The news follows his departure from the board of the Mater Misericordiae University Hospital, which was reported in the Sunday Independent, and the resignation of his colleague Brian McKiernan from the provost’s council at Trinity College Dublin and the governing council of the Royal Victoria Eye and Ear Hospital in Dublin.

Mr Garry also is no longer listed as a director on the website of Brown Advisory, a US asset manager where he was a director of Brown Advisory Funds PLC, the company's Irish-incorporated umbrella fund. Mr Garry was appointed to the role in 2017.

Brown Advisory did not repond to requests to confirm Mr Garry's departure from its board.

Mr Garry resigned as a non-executive director of Econiq, an Irish-founded US-based remote meeting software company, on February 24, 2021 after serving for four years. CEO Jim Callan confirmed that Mr Garry would not be seeking a further term as director.

Mr Garry, a native of Ennis, Co Clare, last week stepped down as head of a review committee that was a compiling a strategic plan for Clare GAA.

The resignations come at the tail end of two weeks of crisis at Davy, during which the firm ousted three of its most senior figures, lost its authorisation to deal Irish Government bonds, closed its bond desk, and put itself up for sale.

Mr Garry was CEO of Davy in 2014 when Belfast businessman Patrick Kearney sold €27m in Anglo Irish Bank bonds via at a steep discount in order to settle a debt – without knowing the buyers were 16 Davy employees, including Mr Garry, who went on to sell the assets at a much higher price.

Mr Garry retired as Davy CEO in 2015 and was replaced by Mr McKiernan, who also participated in the scheme.

Mr McKiernan resigned from Davy four days after the Central Bank enforcement notice, alongside deputy chairman Kyran McLaughlin and head of bonds Barry Nangle.

Davy interim CEO Bernard Byrne spent the last 14 days firefighting the inferno threatening to engulf the firm.

Last Friday, he wrote to clients to apologise for the firm’s conduct in the bond scandal and for the findings of a Central Bank investigation into the transaction, which determined that Davy staff acted with a lack of candour.

Mr Byrne also reportedly instructed staff at the firm to review their transactions to determine whether any other deals failed to meet acceptable regulatory and ethical standards.

Davy has pledged to appointed an independent external party to conduct a comprehensive review of the firm in light of the bond scandal and the subsequent fallout.