Friday 2 December 2016

AIB chief was paid €900,000 amid huge €3.5bn state bailout

Emmet Oliver

Published 09/03/2010 | 05:00

Former AIB chief executive Eugene Sheehy got a €900,000 package last year
Former AIB chief executive Eugene Sheehy got a €900,000 package last year
Managing director Colm Doherty, former head of capital markets, a unit where bonuses were triggered for 2008, but not paid yet
Former chairman Dermot Gleeson's package was €203,000 before retirement
Sean O'Driscoll, a non-executive director waived all his fees in 2009

AIB chief Eugene Sheehy walked away with total pay and benefits of almost €900,000 last year even though the bank needed a €3.5bn bailout from taxpayers to survive.

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Directors collected over €3.5m in salaries, pension payments and company car allowances in 2009, with Colm Doherty, who took over as managing director in November, paid €833,000 in pay, pension and other benefits as a director.

Former chairman Dermot Gleeson, who was struck with eggs by angry shareholders last year, pocketed €203,000 before his retirement in the summer.

For the first time the bank is also revealing the extent of loans and credit card debts the directors and executives have with the bank.

The bank also admitted that several divisions were paid bonuses in 2009, despite the bank's share price plunging and the bank announcing its first ever loss covering 2009.

Bonuses were paid to staff at Polish subsidiary BZWBK and the bank's unit in the Channel Islands.

Bonuses were also triggered in the capital markets division for work done in 2008.

This division was led by Mr Doherty for most of 2009, but the bank has not paid these bonuses in Ireland to date, but they were paid to staff in other markets.

The threat of legal challenge forced the bank to pay the bonuses, said AIB.

Figures filed in the US show that some of the bank's executives held loans with the bank for as much as €4.4m during the year.

Decisions

Mr Sheehy paid off a loan worth €2.3m during the year and ex-chairman Dermot Gleeson had a loan of €1.7m as the year ended. Sheehy, who has been blamed for some of the poor lending decisions of recent years, collected a salary of €638,000, a pension contribution of €196,000, plus a company car benefit.

His total remuneration totalled €892,000.This was down on the €1.1m in 2009. Overall the pay and benefits in 2009 dropped to €3.5m from €5m in the previous year.

In an unprecedented move, Sean O'Driscoll, a non-executive director, waived his entire fees in 2009 and intends to waive them again this year until his retirement in April.

His decision was unique with some other non-executive directors picking up fees of up to €150,000. The current executive chairman of the bank, Dan O'Connor, was paid €156,000 in 2009. It is not known what he will be paid this year.

Neither of the government's two directors at the bank, Declan Collier and Dick Spring hold any shares in the institution, at least according to the period until December 2009.

The bank said that during 2009, it took determined action to reduce its remuneration spend and cost base in light of the financial crisis.

However, it conceded that pay increases of around 3pc were paid to staff, below manager level, following extensive negotiations with the Irish Bank Officials Association.

Irish Independent

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