AIB freezes hiring and promoting to curb expenses

Seen & Heard: union expresses disappointment at lender’s latest cost-cutting plan

Personnel costs were the main contributor to AIB’s higher expenses, growing 8 per cent or €29 million between January and June over the same period in 2018, because of wage inflation and a higher headcount.

Personnel costs were the main contributor to AIB’s higher expenses, growing 8 per cent or €29 million between January and June over the same period in 2018, because of wage inflation and a higher headcount.

 

AIB has imposed an embargo on recruitment and promotion for its 9,800 staff as the State-controlled lender moves to keep a lid on costs, according to a report in The Sunday Times. The move follows mounting concerns after AIB reported a 6 per cent increase in operating expenses in the first half of 2019. Costs fell by 3 per cent at rival Bank of Ireland during the same period.

Personnel costs were the main contributor to AIB’s higher expenses, growing 8 per cent or €29 million between January and June over the same period in 2018, because of wage inflation and a higher headcount. The report said AIB chief executive Colin Hunt identified cost containment as a key priority when announcing the interim results.

The bank informed the Financial Services Union (FSU) last week. In a circular to members, the FSU indicated the move was unexpected and expressed its disappointment.

Broadband deal signing set to be delayed for month

The signing of the State’s €2.9 billion national broadband contract will be delayed after the Department of Communications added a month-long extension to a consultation process required under EU state-aid regulations, according to The Sunday Times. In May, when the Government announced Granahan McCourt, an American-owned investment company, as the preferred bidder, Richard Bruton, the communications minister, indicated that the rural broadband contract would be signed in September. However, the final map of properties to be covered cannot be completed until the department establishes if commercial broadband providers intend serving any of the 540,000 homes, farms and business in the “provisional intervention region”, the report says.

Cherrywood facing ‘severe delays’ over €62 million funding gap

The development of Cherrywood in south Dublin, the country’s most significant housing development, is at “high risk” of being severely delayed by a €62 million funding shortfall, the Sunday Independent has learned. As Cherrywood is a greenfield site, there is a requirement for the build-out of extensive infrastructure, such as roads, bridges and flood attenuation areas. The estimated cost of this so-called common infrastructure is €175 million, according to Dún Laoghaire-Rathdown County Council.

No time limit on tracker complaints after ‘review’ by Bank of Ireland

Bank of Ireland will not seek to apply any time limit on customers who believe they were affected by the tracker mortgage scandal and want to take a case to the financial services ombudsman after the lender “reviewed” its approach to the matter, according to a report in the Sunday Business Post. Ger Deering, the Financial Services and Pensions Ombudsman, last week raised concerns that some banks were challenging his office’s attempts to investigate hundreds of tracker complaints by claiming they fell outside a six-year legal time frame.

Mayfair Equity in talks to buy BT Ireland

Mayfair Equity Partners, a London investment company, has entered into exclusive talks to purchase BT Ireland, the country’s second largest telecoms company, The Sunday Times reports. BT Ireland has operated in the Republic for over two decades, providing communications and IT services to large businesses and the public sector, as well as wholesaling services to other communications companies. Mayfair, which has a number of investments in Ireland, has agreed a month-long exclusivity period with BT plc to finalise a deal. BT has hired Bank of America Merrill Lynch to conduct the sale of a number of overseas subsidiaries.