Key bank staff each get bonus of €180,000
Social welfare cut by €8 a week
Only future deals hit by 90pc tax
SENIOR AIB executives were awarded bonuses averaging €180,000 last year despite the bank's record losses and a massive taxpayer bailout.
Further details of who was paid what can be revealed as fury rages over the €40m chunk of bonuses detailed yesterday by the Irish Independent.
On the same day as Budget social welfare cuts were passed -- which will reduce basic benefits by €8 a week -- an embarrassed Government admitted it was powerless to halt the bonuses.
Last night Finance Minister Brian Lenihan announced a new 90pc tax on future bonuses -- but significantly this will not apply to the AIB payments.
The massive payouts are part of a series of recent bonuses -- including the €40m which caused such controversy yesterday.
New figures obtained by the Irish Independent reveal:
- Just 62 senior staff shared an €11.1m bonus pot, despite the virtually nationalised bank posting record losses.
- A further 670 executives were paid €30m in bonuses, taking home an average of more than €44,000.
This was at a time when the bank was being propped up by taxpayers and share prices had collapsed to record lows.
The taxpayer has already injected €7.4bn into the bank, with another €8bn to come, which will leave the state owning around 96pc to 98pc of AIB.
Details of the huge bonuses sparked widespread anger among opposition parties and charity groups who saw their funding cut in this week's Budget.
Fine Gael called on the Government to follow US President Barack Obama's example by imposing 99pc tax on the bonuses paid to senior bankers and claimed it could be legally applied to the AIB payments.
The party's deputy leader Dr James Reilly contrasted bank executives spending their bonuses "on Caribbean cruises" with the plight of struggling welfare recipients.
AIB yesterday attempted to quell mounting anger among its own staff and shareholders.
In an email -- seen by the Irish Independent -- executive chairman David Hodgkinson told employees the bank was legally bound to pay about €39.2m of bonuses to staff over the last few weeks.
Mr Hodgkinson, who joined the bank as chairman in late October, insisted the decision to pay the money "reflects the past and is not the way we intend to conduct ourselves in future".
He added: "The issues we are facing mean that the bank currently relies on government and taxpayer support and I am working to ensure that, in future, our pay and benefits policy is more reflective of our organisation's responsibilities, performance and of the economic climate in general."
Much smaller amounts were paid out to workers at a call centre in the Isle of Man.
The vast majority of those paid the largest bonuses work in the bank's capital markets division which was led by Colm Doherty until he was appointed managing director of the bank in 2009, against the wishes of Finance Minister Brian Lenihan.
Mr Doherty ran capital markets, which trades in financial products such as currencies, as a separate division.
It remained profitable even as the bank's main division posted record losses due to dud loans to property developers.
While salaries inside the capital markets division are confidential, performance-related pay makes up a large part of the income of the 90 traders working in the unit.
AIB decided to pay the bonuses after an employee, John Foy, won a test case in the UK High Court last month which saw judges rule his €160,000 bonus should be paid.
Mr Foy, who took the court case against the bank, told the court the bonus formed most of his remuneration.
He was hired by the bank back in 2005 on a basic salary of €75,190 a year, but earned more than twice this amount in his bonus.
He argued in court that he and his family were suffering "unjustified hardship" following AIB's attempt to withhold the bonus.
All Irish banks officially scrapped bonuses after the Government offered to guarantee deposits to avert a run on the country's lenders during the credit crisis.
But Mr Lenihan's written reply to a parliamentary question confirms AIB, Bank of Ireland and Anglo Irish have all paid bonuses recently.
Bank of Ireland made payments to "a small number of people at middle management" last year including 10 "bonus" awards -- but refused to tell the Government how much was paid. Like AIB, Bank of Ireland blamed contractual entitlements.
Mr Lenihan also confirmed Anglo Irish Bank paid five separate bonus payments to staff this year.
All staff below manager level got 5pc pay increases in January 2009 -- the same month the Government took control of the stricken bank.
Some 10 other Anglo staff also received bonus payments in 2009, with a further five paid a bonus this year.
Bank of Ireland said the bonus payments related to work carried out in previous years.
The country's largest bank added that some workers had received pay increases following promotions, but this applied to fewer than one in 25 employees.
Both banks refused to disclose the exact amounts of the bonus payments made to its employees.
Meanwhile, the bonuses paid to AIB staff could be investigated by EU Commission.
Commission spokeswoman Amelia Torres admitted the decision by the bank to pay bonuses while recording multi-million euro losses was "slightly bizarre".