AIB set to axe more than 1,000 jobs in major staff cull
‘Planned’ redundancies are to be rolled out
MORE than a thousand jobs are to be slashed at one of the country’s biggest banks.
Staff numbers at AIB will drop from 10,000 to below 9,000, as the number of people now required to deal with bad debt at the bank has fallen.
AIB chief executive Colin Hunt said: ‘Over time, the bank’s headcount, based on an unchanged business offering, based on our current suite of products, based on our current strategy, it is inevitable that we will have a smaller workforce in the medium term.
‘But we will do it in a way that is planned, we will do it in a way that’s agreed.’
Speaking in response to the news, John O’Connell, general secretary of the Financial Services Union, told the Irish Daily Mail: ‘We note that Mr Hunt has said that any changes as a result of a new business plan he is bringing forward will be planned and agreed.
‘We will be engaging with the bank to get full details of what is proposed and will consider the bank’s plans, taking into account our members’ job security and ongoing commitment to change.’
In an interview with the Sunday Independent, Mr Hunt also called on the strict lending rules for first-time buyers to be relaxed, saying they had served their purpose.
‘We’ve been big supporters. We believe [the lending restrictions] were necessary, we believe they have achieved their objectives but they shouldn’t be set in stone. They should adjust to and reflect a changed pricing environment and a changed economic environment.’
In July Taoiseach Leo Varadkar made similar remarks by calling for the Central Bank bank to loosen lending restrictions.
The Government retained the Help-to-Buy scheme in last week’s Budget but were criticised for not doing more to help first-time buyers get on the property ladder.
Mr Hunt said the lending rules should be changed to reflect a changing economic landscape, with house price inflation finally slowing.
‘In normal circumstances, in an uncontrolled environment you would have rampant house price inflation given that imbalance.
‘We welcomed the macroprudential rules. I am a big supporter of them. They have done exactly what they were intended to do, which was to ensure you don’t have runaway house price inflation given the imbalance that’s there.
‘But given the fact that they have done exactly what they were supposed to do, which was to put a lid – and a very, very effective lid, on house price inflation – now it is effectively zero and some would say Dublin is falling, which has negative confidence impact by the way.
‘And given the fact that we are coming potentially into a changed economic landscape, it would be worth revising them at this point, I think.’
However, Mr Hunt who took over as chief executive of AIB in March this year, said mistakes had been learned from the crash and that lending would still be done far more conservatively than before.
‘I am not saying for one minute that you would do away with the rules, I think they are very, very useful and an important initiative and one we support.
‘But certainly, given the changes that have happened, it would be worth having a look and seeing if you can have some change’.
Mr Hunt also gave a stark outlook on the economy, saying: ‘We are closer to the next recession than we are to the last.’
Lending rules should change