2,000 jobs may go as AIB to unveil €8.6bn losses

LARGE-scale job losses are expected at Allied Irish Bank in the wake of the bank reporting substantial losses estimated at close to €8.6 billion for 2010.

Speculation mounted over the past few days that the virtually nationalised bank, which is close to unveiling a major restructuring plan, could be about to announce up to 2,000 job cuts in its Irish operations, where 12,000 people are employed.

Today’s results are expected to show heavy losses for the last year, but as much attention will be on any clarification on the radical overhaul pending at the bank.

It has been mooted that the job losses will occur on a phased basis, with senior positions being hit first.

The bank’s current management — which is also set to undergo a major overhaul — has already stated that it would prefer most redundancies being made on a voluntary basis.

AIB, which is now 93% state-owned and needs another €13.3bn in fresh capital, is set to be restructured into three main divisions — retail, commercial and corporate — with the EBS Building Society being subsumed into its new structure.

That latter move makes it difficult, according to some, to put a finger on just how many jobs could be shed by the enlarged bank.

“We would be concerned that substantial job losses are imminent, but it would be hard to guess an exact figure as there are still so many variables; such as will this include the EBS merger and what effect will any further asset disposals have.

“Many commentators expect some sort of announcement, on the restructuring, today but how much detail is unclear,” according to a spokesperson for the Irish Bank Officials’ Association (IBOA).

Just two years ago the IBOA predicted around 10,000 job losses across the bank sector. To date, about 7,000 of those have either come to pass or are in the offing.

Nevertheless, some clarification is expected. However, it is not so certain as to the timeframe for an unveiling of new senior executives at AIB — including its new chief executive.

Nothing concrete is anticipated today, but last month executive chairman David Hodgkinson said that a new executive team would be selected as soon as possible.

Analysts are anticipating AIB reporting a net loss of around €8.6bn for 2010, with the other prospective pillar of Ireland’s future banking landscape, Bank of Ireland, potentially recording a €1.9bn loss, when it reports its 2010 figures on Thursday.

More in this section

News Wrap

A lunchtime summary of content highlights on the Irish Examiner website. Delivered at 1pm each day.

Sign up

Our Covid-free newsletter brings together some of the best bits from irishexaminer.com, as chosen by our editor, direct to your inbox every Monday.

Sign up