Government and AIB agree on new management

THE musical chairs in and around Allied Irish Banks became clearer yesterday after it and the Government reached agreement on its new management appointees.

Government and AIB agree on new management

This will be a temporary arrangement subject to the outcome of a European restructuring plan and its engagement with NAMA, which are due to be completed by the middle of next year.

The changes at AIB had already been leaked. However, the finer details became clearer with almost identical announcements from Taoiseach Brian Cowen and the bank.

The most high-profile movers will be Dr Michael Somers, the outspoken and outgoing chief executive of the National Treasury Management Agency. He will take up the bank’s deputy-chairman post from David Pritchard who stays on as a senior independent director.

Mr Somers will also take responsibility as chair of AIB’s risk committee.

He will bring intimate knowledge of the NAMA entity after helping oversee its creation, but will take a significant pay cut from his speculated salary of €1m at the NTMA.

John Corrigan, who heads the National Pension Reserve Fund, will replace Dr Somers as chief executive of the NTMA.

Elsewhere at AIB, the group finance director and group chief risk officer positions will be filled by people from outside the company. These have not been decided on yet.

Confirmation of another leak from the bank revealed that Dan O’Connor will become its executive chairman on a temporary basis. He will be tasked with trying to raise capital for the bank’s depleted reserves.

The new post of managing director will be filled by Colm Doherty.

He moves from the position of executive director where he was rewarded with a €822,000 package last year. However, to meet Department of Finance demands he will only be paid a €500,000 salary to handle the day-to-day running of the bank.

AIB said these are part of “wider series of management changes” which it believes will have an “emphasis on attracting new external talent”.

In another move, which had been flagged for some time, AIB’s chief executive Eugene Sheehy will retire at the end of this month.

Mr Sheehy enjoyed a pay packet of €1.15m for doing his job in 2008.

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