independent

Friday 18 April 2014

Noonan under pressure to act on salaries of BoI bosses

Michael Noonan, Ireland's finance minister, speaks during an interview in New York, U.S., on Wednesday, Jan. 29, 2014. Noonan said Bank of England Governor Mark Carney told him at Davos last week that RBS unit Ulster Banks position in Ireland wont change as part of parent review to conclude next month. Photographer: Scott Eells/Bloomberg *** Local Caption *** Michael Noonan
Michael Noonan

FINANCE Minister Michael Noonan has come under renewed pressure to tackle the massive salaries and perks enjoyed by senior executives at Bank of Ireland.

He is to be grilled by the Dail's Finance Committee over how he intends to exercise the State's 15pc stake at the bank's forthcoming AGM in April.

That meeting is expected to be dominated by the pay pot enjoyed by the bank's board of directors, in particular its CEO, Richie Boucher.

Mr Boucher, who was at the helm of the bank when it was bailed out in 2009, is paid €843,000, according to the latest figures. This is significantly above the Government's banking remuneration cap of €500,000, which was introduced in mid-2011.

There were major tensions between the coalition partners last year following strong criticism of Mr Noonan by Labour TD Kevin Humphreys.

He accused the Finance Minister of displaying a lack of leadership after he declined to vote on the issue of directors' pay.

The Dublin South East TD is now calling on Mr Noonan to "fully engage" with the Finance Committee as to how the taxpayer can be best served at this year's AGM.

Mr Humphreys old the Irish Independent: "I'm very concerned by the high level of salaries and payments to senior bank executives.

BONUSES

"I believe that we should not see any bonuses at Bank of Ireland whatsoever until it returns to profitability. It would send out entirely the wrong message if we were to see bonuses paid out.

"Mr Noonan came down tough recently in relation to potential bonuses at AIB.

"Unfortunately, we are unable to force down the salaries of people who have contracts at Bank of Ireland but we need to ensure that Mr Noonan, who can exercise the stake on behalf of the citizens of the country, comes in front of the committee prior to the AGM and fully engages with members."

Finance sources have indicated that Mr Noonan is "unlikely" to apply pressure at the AGM regarding pay. He is understood to be satisfied with efforts being made at the bank to return to profitability.

A spokeswoman for Bank of Ireland said that the bank had no comment to make.

The Department of Finance last night said that all banks, including Bank of Ireland, had fulfilled their commitments of cutting remuneration costs by up to 10pc.

Meanwhile, Public Expenditure Minister Brendan Howlin has expressed concern that a culture exists whereby civil servants do not take any legitimate risks.

He told the Oireachtas Joint Committee on Finance, Public Expenditure and Reform that he was seeking to create a high-quality public service, where there is accountability for both inputs and outputs.

Irish Independent

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