'Vested interests promoting merger of B of I and AIB'

The Irish Bank Officials' Association (IBOA) has once again voiced strong opposition to a merger between Bank of Ireland and AIB stating that vested interests are now being used to promote its benefits.

In a statement yesterday, IBOA general secretary Mr Larry Broderick warned that the banks were pursuing this plan without consideration for staff, customers and the independence of the financial services industry.

Mr Broderick said it would appear that vested interests such as the former Competition Authority chairman, Dr Paddy McNutt, were being used to propagate the merger without due consideration being given to the implications for staff and customers who would be affected.

Writing in the latest edition of the Irish Banking Review, Dr McNutt said the time may be right for consideration of a link-up between Ireland's two biggest banks. Mr Broderick said the IBOA found his comments "amazing" particularly given the view taken in Europe and in the UK when other banks attempted to merge. "Both AIB and Bank of Ireland are extremely profitable organisations in their own right and to suggest that a merger was needed for them to remain competitive was a nonsense," according to Mr Broderick.

He reiterated that a merger could result in up to 5,000 job losses and challenged the advocates of this merger to detail their plans.

Mr Broderick said such a merger would be a "nightmare" for customers and would create a monopolistic entity.

The IBOA has also expressed disappointment with the lack of information provided by AIB and Bank of Ireland to the trade union about the merging of their information technology functions. It has written to both banks and is seeking a meeting with the European Commission in advance of its decision on this proposal.

Mr Broderick called on the Minister for Finance, Mr McCreevy, to establish a forum on banking where a debate on mergers could be discussed in an open and transparent way.