AIB staff facing mass redundancy
Allied Irish Banks expects to turn a profit next year with 2,000 staff facing the axe.
The bailed out lender, once Ireland's biggest bank, has announced losses of 10.4 billion euro and a massive redundancy plan to rein in costs. And union leaders warned this is the single biggest number of lay-offs in a troubled finance house, with another 4,000 jobs at risk in the industry.
AIB - which was told a fortnight ago it needs refunding with another 13 billion euro - said it was considering a debt forgiveness scheme for struggling mortgage holders as citizens keep the bank afloat.
Management revealed they are looking at the possibilities for easing pressure on thousands of households after 2010 results showed 1.3 billion euro of mortgages in arrears for 90 days or more.
David Hodgkinson, AIB executive chairman, accepted the bank has operated badly and it would take time to deal with the legacy. "There was almost a kind of collective madness, everybody went crazy on property and for a very long time," he said.
The Irish Bank Officials' Association branded the massive job losses an outrageous blow and said rank-and-file staff are being forced to pay for reckless mismanagement.
Larry Broderick, IBOA general secretary, said: "The ordinary staff in AIB are in no way responsible for the bank's disastrous predicament. But it appears that many of them will now be sacrificed in a crude attempt to resolve it."
Brendan Howlin, the Minister for Public Sector Reform and Expenditure, said it was a bleak day for bank workers and signalled more is to come. "It is clear that there is going to be a considerable downsizing of the banking sector in Ireland, that's true and that will involve job losses," Mr Howlin said.
Mr Broderick said that despite 2,000 jobs being shed at AIB since 2008, the latest round of cuts could be achieved on a voluntary basis.
Taoiseach Enda Kenny said he had no objections to holding a debate in the Dail on the job losses. "There are devastating consequences and clearly there are also issues of governance in the banks that need to be addressed and will be addressed," he said.