Sinn Féin will ask the Revenue Commissioners to clarify whether Bank of Ireland’s move to top up the salaries of its chief executive and chief financial officer with bank shares worth up to 50 per cent of their salaries is allowed under remuneration restrictions, the party’s finance spokesman said.
Bank of Ireland said in its annual report, published last week, that the planned so-called fixed share awards were “not subject to any performance conditions”, leaving them, according to the company, outside the scope of an effective continuing ban on performance-related bonuses above €20,000 enshrined in the Finance Act 2011 after taxpayers were forced to rescue the nation’s banks.
The Government moved in December to lift a crisis-era €500,000 limit on executive fixed pay at Bank of Ireland, months after it sold its remaining shares in the bank. It also allowed for a return of bonuses of up to €20,000 across the sector, but any performance-related pay above that level remains subject to a prohibitive 89 per cent levy.
However, Sinn Féin spokesman Pearse Doherty claimed in an interview with RTÉ Radio on Sunday that the share awards were a “grey area” and that his party would be looking for a determination from Revenue that they are allowed.
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A spokesman for Bank of Ireland said the bank was “fully compliant” with all Irish and European rules and regulatory requirements on remuneration, including the changes unveiled last week in its annual report, “which related to fixed pay, not variable pay”.
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“A share allowance of this type is not a new approach in the sector and operates at other banks internationally, compliant with European rules,” he said.
However, Bank of Ireland has said that it is fully compliant with all Irish and European rules and regulatory requirements on remuneration, including the changes unveiled last week in its annual report.
Mr Doherty said the stock award “nails this myth that the reason that the Government relaxed, or got rid of, the ban on bonuses up to €20,000 was to support lower income workers within the bank ... It was always about the senior people,” he said.
Under the new fixed share awards plan, no stock award will be made this year to the chief executive and chief financial officer. However, an “allowance” of 25 per cent of salary will be granted in 2024, rising to 50 per cent from 2025 onwards.
Bank of Ireland’s chief executive, Myles O’Grady, was hired four months ago on a fixed salary of €960,000 before the limit was scrapped. Successive ministers for finance had allowed the bank to pay its top executive more than those in the other banks as it had avoided falling under State control during the financial crisis.
The bank said in its annual report that it had decided to increase the basic salary of its chief financial officer, Mark Spain, by 10 per cent to €550,000.
