The Government is preparing to appoint Seán Donlon, former chief of the Department of Foreign Affairs, to Ireland’s seat on the board of the European Bank for Reconstruction and Development (EBRD).

Mr Donlon, who has held a large number of business directorships since leaving the Civil Service in the 1980s, has strong Fine Gael connections.

He was chief of staff and special adviser to John Bruton when he was taoiseach in the mid-1990s and he advised Minister for Finance Michael Noonan when he led the party in 2001 and 2002.

Although it is unlikely to be confirmed immediately, a well-placed Government source said Mr Donlon's nomination to the directorship of the London-based EBRD has been settled. The bank is a non-EU institution, set up in 1991 to support private lending in the countries of the former Soviet bloc.

Plum post
The directorship is widely considered to be a plum post. It commands a salary of some £140,000 (€163,800) and carries attractive tax provisions.

It is understood that Mr Donlon will resign his corporate directorships when he joins the EBRD in mid-July. He will also forgo his public pension for the duration of his appointment.

He currently serves on the boards of aircraft leasing company Fly Leasing, the University of Limerick Foundation and Birr Scientific and Heritage Foundation.

He previously served on the boards of aircraft leasing firm GPA, insurer Aviva and an assortment of other financial companies.

As a diplomat, Mr Donlon was centrally involved in the negotiation of the Anglo Irish Agreement in 1985. Earlier, as Irish Ambassador to Washington, he clashed with then taoiseach Charlie Haughey over Northern Ireland policy.

Last year he criticised the Government for closing Ireland’s embassy to the Vatican, arguing that the State did not close its embassy in London at any time during the Troubles even when relations were at their worst.

Ireland's seat on the bank's board is currently held by former Fianna Fáil MEP Eoin Ryan, whose three-year term with the EBRD expires shortly.