Thursday 20 June 2019

BoI pushes Donohoe to level pay playing field

Finance Minister Paschal Donohoe. Photo: Tony Gavin
Finance Minister Paschal Donohoe. Photo: Tony Gavin

Michael Cogley

Bank of Ireland used its post-results briefing with the Department of Finance to highlight the "competitive disadvantage" imposed by the bankers' pay restrictions.

The bank's senior management team met with Finance Minister Paschal Donohoe after it posted a €935m pre-tax profit for 2018.

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Under the State's regulations, there is a prohibition on the payment of incentives and limits on pensions and termination payments, so-called 'golden parachutes', as well as a €500,000 pay cap and in addition an 89pc 'super tax' on bonuses in the sector.

Speaking about the contents of the meeting with the minister, a Bank of Ireland spokesman said: "The current restrictions constitute a competitive disadvantage.

"They only apply to three Irish banks, and all other banks and financial services companies operating in Ireland, and all other companies from any sector, are not restricted in the same way."

Bank of Ireland also lamented the fact that it was hamstrung in awarding bonuses to those on lower levels who have been performing well in their roles.

There is mounting pressure from the banks to ease the caps and last week the Central Bank warned that the outright ban on bonuses could pose a "current and future risk" to the sector.

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