AIB in discussions with bank unions over job cuts

Issued : 6 February 2011


Sunday Business Post


Banking staff unions are in discussions with senior management at AIB about significant job losses which are expected in the coming months.

Negotiations around voluntary and early redundancy packages for staff are underway and must be concluded by the end of this month, the deadline for further recapitalisation of the banks, to comply with the Financial Regulator's new rules on minimum capital requirements.

It follows Permanent TSB's announcement last Friday of 280 voluntary redundancies.

Irish Bank Officials Association (IBOA) general secretary Larry Broderick said he anticipated ''significant job losses at AIB'' and feared ''up to 2,000 job losses between AIB and Bank of Ireland restructuring and a merger of Anglo Irish Bank and Irish Nationwide''.

''We are currently in negotiation with AIB senior management and Mark Connaughton (senior counsel), and while these are difficult, they are progressing. We are committed to a process of voluntary redundancies, and maximising the number of staff that can be retained,'' Broderick told The Sunday Business Post.

The difficulty in the negotiations is understood to be related to background moves to raise private capital for AIB, before it too will need to be effectively nationalised with a new injection of capital from the state.

A phased plan of job reductions at AIB over 18 months to two years is seen as the likely outcome of negotiations.

Broderick said a ''a clear direction and plan'' was needed for the future of AIB and Bank of Ireland, which has already announced 750 job cuts.

Meanwhile, it is believed that a decision on the merger of Irish Nationwide and Anglo Irish Bank, at EU level, will be reached by the end of this month, and that this would also have ''a huge effect'' on the 1,400 positions in the two institutions. Sources predicted an ''early announcement'' of the merger, which has to be authorised by the European Commission, within weeks.

Such a move could lead to up to 700 job losses at Anglo, where there are almost 1,000 staff, and a significant cut in the 500 jobs at Irish Nationwide.Sources believe such a large scale rationalisation could take place within six months.

Nicola Cooke