Banking trade union welcomes capital injection

THE main trade union for Irish banking employees, the Irish Bank Officials’ Association (IBOA), has welcomed the Government’s capital injection into the country’s leading banks.

However, it is seeking meetings with bank leaders to discuss the issues relevant to job security and staff conditions. A strong opponent of the idea of the banks being funded via private equity investments, the IBOA said it was cautiously welcoming the move as a “necessary first step in a total overhaul of the Irish banking system”.

“While the minister’s capital funding arrangement for AIB and Bank of Ireland allows the banks to seek investment from private sources, the state’s underwriting of the rights issue means there is no need for AIB or Bank of Ireland to entertain the predatory private equity funds — whose short-term profit maximisation model would not sit well with the need for a steady return to good financial health for the banks which is vital to underpin the recovery of the economy as a whole,” IBOA general secretary Larry Broderick said.

The IBOA is looking for assurances from Finance Minister Brian Lenihan that a “fundamental” review of the culture of Irish banking will take place, private equity funds will be excluded from making significant investments in Irish banks, an extension of the scope of recapitalisation to Irish Life & Permanent (IL&P) and the EBS to ensure further competition will be granted and an independent investigation into all activities by Anglo Irish Bank, in light of its directors’ loans fiasco, will be carried out.