B of I plan to shed 2,160 jobs morally reprehensible - IBOA

Bank of Ireland's plan to cut 2,160 jobs from its staff is "morally reprehensible", the leader of its biggest union told an Oireachtas committee yesterday.

Larry Broderick, general secretary of the Irish Bank Officials' Association (IBOA), told the Oireachtas Committee on Finance and the Public Service yesterday that the institution was concentrating on maximising short-term shareholder value at the expense of staff and customers.

"It is totally unacceptable and morally reprehensible for a bank reporting profits of €1.3 billion to simultaneously announce plans to axe over 2,100 jobs," he said.

"No one, not least Bank of Ireland, should underestimate the shock and anger from staff and customers alike at their decision."

Mr Broderick, whose union represents the bulk of Bank of Ireland staff, added that the bank was already extremely efficient and did not need to embark on a wide-ranging cost-cutting plan.

He argued that the bank's drive to cut its cost-income ratio was misplaced because this measure was widely recognised to be crude and unreliable.

"A recent analysis of British banks shows little correlation between bank profitability and efficiency as measured by the cost-income ratio," he told the hearing.

"Furthermore, it should be noted that some of the most profitable banks in the world - including ABN, Barclays, Crédit Agricole, Paribas Santander and UBS Swiss - have cost-income ratios in excess of 50 per cent," he added.

Mr Broderick also accused the bank of attempting to breach the terms of the national pay deal, Sustaining Progress.

The IBOA sought the hearing with the committee.

At the end of the committee hearing, its chairman, Seán Fleming TD, said that it would leave it open to the bank to appear at a similar hearing but would not try to compel it to appear.