AIB to take legal action over Rusnak losses

AIB said it may consider legal action against any third parties found to have helped rogue trader John Rusnak who cost it nearly $700m in foreign currency exchange losses, at the firm's US subsidiary AllFirst earlier this year.

Weekend reports quote AIB chief executive Michael Buckley as saying the bank's lawyers were in the "early days" of a case against two banks whose staff allegedly helped Rusnak.

Last week AIB agreed to sell AllFirst to M&T Bank, in a stock and cash deal worth more than $3bn.

Sources believe AIB could target Citibank, with which Rusnak did many trades. Citibank suspended two foreign exchange traders shortly after the scandal broke last February.

An inquiry into the scandal by former US currency expert Eugene Ludwig suggested AIB should pursue legal and investigative work into the roles played by brokers and dealing partners of Rusnak.