AIB announcing decisions on €700m rogue dealing

Allied Irish Banks was today set to announce if heads would roll following its foreign exchange loss of almost €700m at American subsidiary Allfirst.

After two days of deliberations in Dublin, the board was announcing its decisions based on the report of top banker and troubleshooter Eugene Ludwig.

The Stock Exchange was being issued with a statement at 7am which was expected to say if senior officials would lose their jobs over the affair.

Investors have been awaiting the outcome of the talks which is sure to affect the way the group’s share price reacts.

Massive losses were run up by trader John Rusnak at Baltimore-based Allfirst and went unspotted for five years.

The extent of the losses only emerged at the beginning of this year after they spiralled out of control, hitting €691m.

The report by Mr Ludwig, of the Promontory Financial Group, is believed to be highly critical of controls at the bank and of internal checks and balances.

Mr Ludwig is also thought to have recommended significant internal changes to counter the possibility of such massive losses crippling the financial institution in the future.

But it is believed AIB group chief executive Michael Buckley will remain in place.

He was set to be at a news conference at the Dublin offices at 11am today alongside AIB chairman Lochlann Quinn and Mr Ludwig.

Those potentially in the firing line were Allfirst Chairman Frank Bramble and chief executive Susan Keating. The bank’s head of treasury, David Cronin, was also potentially vulnerable.

Mr Bramble and Ms Keating were at the talks in Dublin but were believed to have returned to the US last night.