AIB to facilitate departure of 1,900 staff from next month

Thu, Jul 19, 2012, 01:00

AIB IS to facilitate 1,900 staff in leaving through early retirement or voluntary severance in the period from next month to December 2013, it has been learned.

The bank has received a very strong response to its early retirement and first phase voluntary severance schemes.

It aims to shed 2,500 staff over a two-year period as a part of a cost-reduction programme.

A large number of applicants for the two schemes are to be told today that they have not been successful in their applications. However, the bank is to examine its ability to accommodate as many staff as possible in leaving over the coming period.

A management team that has been examining how to facilitate job losses while minimising the impact on the bank’s operational capacity has decided the early retirement dates in the Republic and the UK will be phased to December 2013 rather than 2012, meaning that staff who are due to retire in 2013 are not being considered for the scheme. However they can still avail of the voluntary severance package.

The voluntary severance scheme will open in August in the Republic, and a date for UK staff will be announced in September.

Staff who are not selected for the schemes this time will be able to reapply for the voluntary severance next year.

Bank management will begin telling staff today the response to their individual applications. Approximately 1,900 staff will leave in the period to the end of next year as part of the first phase of the process.

AIB is almost entirely owned by the State, which had to shore up the bank following the massive losses it suffered due to bad loans issued during the property bubble years.

The bank is being reduced in size. This month the bank’s new chief executive, David Duffy, told The Irish Times that its €20 billion deleveraging plan would be more than 90 per cent complete by the end of the year.