DONOHOE DEFENDS BANKERS BONUSES
Minister criticised but insists move not breaking any rules
PASCHAL Donohoe has defended the return of bankers’ bonuses at AIB after being accused of facilitating a “dodge” in a takeover deal.
The Finance Minister has signed off on the pay structure in Goodbody, a stockbroking subsidiary which AIB purchased back this week for €138million, after selling it a decade ago for €24million.
Mr Donohoe has given the go ahead for the banking staff in Goodbody to be eligible for bonuses which they enjoyed up to now under the ownership of Fexco.
And a number of lucky AIB staff who will transfer over to Goodbody will also be freed from the constraints of the bonus ban.
The elite bankers will also not be subject to the current pay cap of €500,000 introduced under the same legislation.
Mr Donohoe faced criticism in the Dail, but he said it was not breaking any rules and was being done to secure jobs.
He said: “The standard remuneration arrangements in a stockbroking business are very different to those that pertain in a retail and commercial bank, such as AIB, and reflecting this the bank had sought my consent for the continuation of the current remuneration arrangements in Goodbody. This has
Willie and Paddy Hennessy been done in a manner which ringfences Goodbody from the rest of the AIB Group and ensures ongoing compliance with Government policy on bank remuneration.”
Sinn Fein finance spokesman Pearse Doherty found these reasons unacceptable.
He said: “As the majority shareholder in AIB, with 71% of the shares, you gave your consent to Goodbody to dodge the bankers’ bonus levy.
“We know now a number of AIB staff will transfer to Goodbody, all of whom will now be able to avail of bonuses and the levy will no longer apply.”