AIB chairman Mr Lochlann Quinn defended the group’s risk management and internal controls today by saying the internal checks would have detected Mr John Rusnak’s activities had they been properly applied.
Speaking during a conference call with analysts this morning, Mr Quinn said Mr Rusnak’s foreign-exchange losses had slipped through AIB’s controls because a few people in Baltimore "went to sleep".
Mr Quinn accepted AIB’s management model of its overseas businesses, which allows for considerable local autonomy, had failed and said the bank will centralise more functions in Dublin.
The management and control of all treasury activities throughout AIB Group will be carried out by AIB Capital Markets in Dublin and all proprietary treasury activities in Allfirst and Poland will cease.
Announcing a number of management changes, AIB’s chief executive Mr Michael Buckley dismissed speculation of a merger between AIB and Bank of Ireland as "idle speculation".
Mr Eugene Sheehy, head of AIB retail business, will move to Baltimore where Ms Susan Keating will continue as chief executive.
A chief risk officer will be appointed who will report directly to the board. The appointee will be of high international standing from outside the bank, according to Mr Buckley.
All finance and risk functions across the group will be centralised under Mr Gary Kennedy, group director of finance. All group internal audit functions will also be centralised.