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Ireland says no to bank bonuses

Dec. 14, 2010 at 2:13 PM   |   Comments

DUBLIN, Ireland, Dec. 14 (UPI) -- Irish Finance Minister Brian Lenihan said the government would block struggling Allied Irish Banks from paying bonus checks in light of recent bank bailouts.

"The provision of further state funding to AIB will be conditional, inter alia, on the non-payment of any bonuses, no matter when they may have been earned," Lenihan wrote in a letter, referring to a bank plan to pay about $53.6 million in bonus checks to senior staff that had been deferred since 2008, The New York Times reported Tuesday.

Alan Kelly, corporate services manager at AIB said the bank had been looking for a legal out, so it would not have to pay the bonuses. One employee, John Foy, a trader, had gone to court and forced the bank to pay $214,000 in bonus pay.

Lenihan said in a radio interview it was "galling" to have the bank hand out bonus checks given the $113 billion in international loans granted to Ireland in part to help it bailout its banks.

Lenihan also said the government would push to seal the no-bonus condition in law. The stipulation would be added to a bank restructuring bill currently in debate in parliament, he said.

AIB, expected to receive at least $48 million in additional government aid, has already received $4.7 billion from the government.

© 2010 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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