AIB targets former executives
The transfer of assets was “not to fund any particular pension but to address the critical mass of the population [all pension fund members],” he said.
AIB transferred the assets into the pension fund earlier this year so that the early retirement scheme, under which the majority of the 2,500 staff leaving the bank, could proceed, he said in today’s statement. If this had not happened the bank’s voluntary severance scheme could not have taken place and this was a key part of saving the bank more than €200 million a year.
The transfer of assets off AIB’s balance sheet was also part of the bank’s strategy to dispose of “non-core” assets under the troika-directed deleveraging plan to reduce the size of the bank within the capital costs of the 2011 stress tests. He said that the assets were transferred following independent valuations of the assets by both the bank and the trustees.
Mr Duffy told the Financial Times that more than 15 former executives directors who worked at the bank in the lead-up to the banking crisis would receive letters over the next four to six weeks. The first letters were sent yesterday. The bank had no legal authority to force former directors to forego part of their pensions but that there was a moral obligation on individuals, he said.
“On a moral basis we believe that there is a judgment that some individuals can make a contribution,” said Mr Duffy, who joined the bank as chief executive almost a year ago.
“I am not here to be judge and jury. I am just here to recognise the fact that I should hold a mirror up and say, ‘this is the pain and suffering that the bank employees are going through. You have been part of that cycle of the economy you must make a judgment yourself,’” he told the newspaper.
Fianna Fáil finance spokesperson Michael McGrath welcomed the move but said it was a pity it “had to be forced on the bank”.
He called on the bank to reveal which former directors had been written to and said all directors who had served with the bank during the period of time leading up to the bank being nationalised should be asked to forego some of their pensions.