THE EXECUTIVE chairman of AIB has told staff in an e-mail that the payment of deferred bonuses “reflects the past and is not the way we intend to conduct ourselves in future”.
The bank said it was contractually obliged to pay bonuses withheld from capital markets staff under the terms of the bank guarantee for the unit’s profitable performance in 2008 after an employee won a test case.
David Hodgkinson said: “The issues we are facing mean that the bank currently relies on Government and taxpayer support and I am working to ensure that, in future, our pay and benefits policy is more reflective of our organisation’s responsibilities, performance and of the economic climate.”
The High Court ordered the bank to pay €160,000 to trader John Foy, who was one of about 90 staff who had taken legal action against the bank over the bonuses.
European Commission president José Barroso said a restructuring plan for AIB to be negotiated with EU competition authorities would “place clear conditionality on remuneration to executives”.
The extent of the bonus payments to AIB staff was outlined in a response by Minister for Finance Brian Lenihan to a parliamentary question 10 days ago.
Some 2,869 employees were paid €58.65 million in bonuses, of which €35.5 million was paid over last month and in the bank’s pay package next week following the court ruling early last month.
A further €3.7 million in bonuses to be paid to capital markets staff on deferred bonuses for 2006 and 2007 will be booked in the bank’s 2010 accounts.
The remaining €2.4 million in contractual bonuses was paid to junior and clerical staff in AIB call centres and in the bank’s offices in Jersey and the Isle of Man.
Some 62 executives shared €11.11 million, or an average of €179,000 each, for 2009, while 674 managers shared €30 million or an average of €44,000 each.
An AIB spokesman said no bonuses were paid for the bank’s performance in 2009 or 2010.
The bankrequires another €9.8 billion on top of €3.5 billion already injected by the taxpayer to meet losses incurred by AIB, mostly on property lending.
Mr Lenihan said he plans to introduce a 90 per cent tax on future bonuses to bank staff after it emerged that AIB staff were being paid €39.2 billion in bonuses.
He told the Dáil yesterday that he would propose an amendment to the upcoming Finance Bill. The tax will apply to the guaranteed financial institutions but not on the bonuses being paid at AIB last month or next week.
