Bankers’ €500k pay cap more than enough: Burton
FORMER tánaiste Joan Burton has said that half a million euro is ‘more than enough pay’ for any banking executive, and that the bankers’ pay cap must stay in place.
Her comments come just days after the resignation of well-respected AIB chief executive Bernard Byrne, who has reportedly been offered more lucrative employment.
Ms Burton, now the party’s finance spokeswoman, said that the €500,000 pay cap had been put in place following the financial collapse and a huge state bailout of the banks.
‘We have just passed the ten-year [anniversary] of the blanket bank guarantee and the disastrous policies bankers pursued that did huge damage to Ireland and other countries.
‘As we saw before the crash, lavish pay is no guarantee of executive success but the lobbying and media campaign to lift the pay cap is fully under way, and no doubt will continue for months to come,’ she said.
The Department of Finance has commissioned a review of the banker salary cap that is expected to be completed by the end of year. Currently, salaries are capped at €500,000 and bonuses are banned.
Ms Burton said that, as state-owned banks, AIB and Permanent TSB should lead by example by limiting executive pay.
AIB shares dropped over 8% last week after Mr Byrne announced that he is to step down.
The drop in share price has wiped approximately €1billion off the value of AIB. Mr Byrne has led the bank since 2015, having previously held a number of senior executive positions, including chief financial officer and director of personal, business and corporate banking.
His departure is likely to revive concerns raised by AIB’s management about the pay cap on bank salaries, after it warned in 2017 that it risked losing employees to international banks.
In response to Mr Byrne’s decision to step down, AIB chairman Richard Pym said: ‘It was a very grim day in my life when Bernard told me that he had an external opportunity which he wanted to pursue.
‘The fact that it came so soon after the resignation of our chief financial officer, Mark Bourke, made it doubly difficult.’
Mr Pym added that Mr Byrne had been a ‘great business partner to me and a good friend’.
Mr Byrne will remain as CEO of AIB into 2019.