Pay cap of 500,000 euro at AIB and PTSB removed, Finance Minister says

A pay cap of 500,000 euro in place at AIB and PTSB is to be lifted, Finance Minister Paschal Donohoe said.
Mr Donohoe, who made the announcement after the Government sold its final 2% stake in AIB on Monday, said it was not appropriate to set pay restrictions when it did not own the bank.
He said a cap in place for PTSB, in which the State still holds a 57.4% share, would also be lifted.
He said that since the financial crash, various regulatory reforms have been introduced to strengthen the oversight of the banking sector.
He said this range of measures was a better way to regulate the banks rather than with salary caps.
'This pay cap will now be removed for both of those banks,' Mr Donohoe said.
'The skillset required in the banking sector is evolving, and in some cases the greatest demand for staff can be in areas such as IT, cyber, risk management, legal areas and compliance decisions.'
Mr Donohoe said the cap was being lifted to ensure the banks could compete with one another more effectively for personnel.
'These skills are in demand right now across the economy, and so the banks are competing for this talent against other companies who are more flexible and have different remuneration policies.'
Mr Donohoe was asked about the possibility that the public would be annoyed at bankers' maximum pay increasing while interest repayment rates are high.
'Of course, I understand that any decision like this with regard to bank pay is one that will always be viewed critically by people who are both critical of our banks, but also remember all of the cost and difficulty that I was at pains to acknowledge in my statement.
'What I would say to those, and there are many who continue to be concerned, is firstly that I don't believe that it is correct that we set pay in a company that we no longer have any share in, that as a small, open economy we're trying to attract investment into our economy, and I would hope that banks like AIB and Bank of Ireland will continue to be able to attract investment in their future.
'For that reason, us playing a role in setting their pay when we no longer own a single share in those companies is not appropriate.
'Again, I can understand the sensitivity of a decision like this for so many, but the changes that we have made and how our banks are supervised are really considerable.'
He said they would review options in relation to the future ownership of PTSB under review.
'I did decide there was a fundamental difference between a bank of the scale of PTSB operating in an environment in which one bank is removed from the pay framework, as opposed to where both other banks that it competes against are removed from it.
'The fact that we were moving to an environment where both of the pillar banks that they would compete against, in every sense, would be out of the framework, I decided it was a very important factor versus where they were in the past with only one.'
He said this was an 'important moment' in Ireland's economic journey and said it was about sending a signal that Ireland wants a competitive banking sector.
During the financial crash, the Irish State invested 29.4 billion euro in AIB, Bank of Ireland and PTSB between 2009 and 2011.
When AIB shares were first floated for sale in 2017, the State had a 99.8% stake in the bank.
To date, the State has recouped more than 29 billion euro from two of the three banks it held shares in.
The Irish state sold its final shares in Bank of Ireland in September 2022.

Try Our AI Features

Explore what Daily8 AI can do for you:

Learn with AIFact CheckingText to SpeechAI Summary

Related Articles

The Guardian

27 minutes ago

• The Guardian

Cult of celebrity feels like a fundamental tension at the heart of the game

It is in the details that the truest picture emerges. Quite aside from the endless politicking, the forever-war with Uefa, the consorting with autocrats and the intriguing broadcast rights and partnership deals, there has been, not a new, but growing sense during the Club World Cup that Fifa doesn't really get football. There is something cargo-cultish about it, creating outcomes without engaging in processes. Perhaps that is inevitable with Gianni Infantino's style of leadership; like all populists, he is big on vision and short on practical reality. It was there in the expansion of the World Cup to 48 teams. OK: how will the tournament be organised? Sixteen groups of three. Won't that mean either lots of potential dead rubbers (one team from each group goes through) or opportunities for collusion (two go through)? Oh, actually, the four-team groups at the 2022 have worked so well, we'll go with 12 groups of four. Sure, but then you have eight best third-place teams going through which: a) diminishes jeopardy; and b) undermines sporting integrity by giving an advantage to teams in later groups because they have a clearer idea of what is needed to progress, again offering opportunities for collusion. No response, because all that matters is a bigger tournament equals more votes for the president and (in the short term) more revenue. One of the oddest aspects of the Club World Cup has been the way players are greeted on to the pitch individually, like swimmers before an Olympic final. At Ulsan HD v Mamelodi Sundowns, they may as well have gone on and introduced the crowd as well. Who needs this? Who wants this? Why does the first player out have to hang around for several minutes waiting for the 22nd player? For well over a century the two teams have walked out side by side. This has always been part of the gladiatorial ritual of football. This is the contest: one team against another. But as Fifa has sought desperately to improve attendances and stimulate interest, its focus has become more and more on the individual. That is why there was all that talk, much of it emanating from Infantino, about Cristiano Ronaldo potentially securing a short-term deal with a qualifier, and why qualifying was gerrymandered to ensure the presence of Lionel Messi's Inter Miami. But there is a potentially self-defeating short-termism to this. While the desire to see Messi is entirely understandable, especially as he enters the late autumn of his career, Inter Miami are sixth in MLS's Western Conference, their form having disintegrated since the end of March. From an MLS point of view, the ideal scenario would have been for one of their sides to beat a storied opponent, perhaps push on to the quarter-finals, generating interest in North America's domestic league. The best way of doing that would have been to have the best-possible MLS representation, but Inter Miami are in no sense one of the best three sides. As it is, none of the MLS sides won their opening game, although Porto's dismal form and Messi's dead-ball ability may get Inter Miami through anyway. It might also be pointed out that Auckland City are not the best side in New Zealand, nor are Red Bull Salzburg one of the best 12 sides in Europe, but the consequences are greater for the host nation, particularly when there is apparently so much potential for growth. The celebritisation of football is not new, but it is intensifying. When Paul Pogba returned to Manchester United in 2016 and, rather than speaking of the Premier League or becoming a European champion, said he dreamed of winning the Ballon d'Or, it felt shocking, a player elevating his own interests and a silly bauble above the glory of team success. But that has become normal. Improving his Ballon d'Or chances is one of the reasons Neymar left Barcelona for Paris Saint-Germain; even Trent Alexander-Arnold mentioned the Ballon d'Or as a motivation for joining Real Madrid (good luck with that from right-back). Sign up to Football Daily Kick off your evenings with the Guardian's take on the world of football after newsletter promotion The marketing of football is almost all focused on individuals. That's been particularly so at the Club World Cup, but it is true of almost every competition. Even the way lineups are introduced on Sky's Premier League coverage, with the players performing a fake celebration, seems designed to introduce them as characters. Yet there is a tension there. While individual players are celebrated, the increasing use of data means image and self-projection may never have mattered less. The stats will find the talent, even if the talent has no gift for self-promotion. At the same time, the best teams have never been so cohesive, so integrated. PSG provide a useful case study. For years they signed stars with seemingly little thought to how they might play together. Although their immense resources won them the French league, they habitually choked in Europe. Then there was a change of approach, the money was spent not on Neymar and Messi but on players on the way up who still had a hunger for success and who could play together. The result was the Champions League and, despite their defeat by Botafogo, possibly the inaugural world title in the expanded format. If it was conceived as a two-stage strategy – build the brand through celebrity, then win the actual competitions – it has worked to perfection; in reality, it's probably trial and error that has brought them to this point. At Real Madrid, meanwhile, Florentino Pérez still seems locked in his galáctico vision of football, insisting on adding Kylian Mbappé to a squad that already contained Vinícius Júnior and Rodrygo, resulting in imbalance and an expensive downturn in form. This goes deeper than transfer policies, though. This feels like a fundamental tension at the heart of the game. What, after all, is success in modern football? Manchester City for the past decade have been a much better football team than PSG, and yet they have nothing like the brand awareness. Is success winning trophies, or making money? Is it winning trophies or becoming more famous? Is it winning trophies or marketing the individual? The individual walk-ons only blur the lines further, suggest organisers who struggle with the concept that football, perhaps more than any other sport, is a game of the team.

Telegraph

41 minutes ago

• Telegraph

Labour must put energy security ahead of net zero ideology

British Government ministers appear to enjoy nothing quite so much as interfering with complex systems they don't entirely understand. Research commissioned by the Department for Energy Security and Net Zero has highlighted one set of clearly unintended consequences that could soon come about as a result of Energy Secretary Ed Miliband's fanatical pursuit of his 2050 target. Interactions between high temperatures, solar panels, heat pumps and the transmission network may result in a greater likelihood of 'electricity shortfalls and loadshedding', a polite euphemism for controlled blackouts. The driving mechanisms are straightforward: heat pumps, soon to be mandatory in newbuilds, and highly incentivised in older properties, offer cooling capabilities that are likely to increase electricity demand during hot periods. At the same time, Britain's distributed renewables grid will be more exposed to degradation of performance due to these same high temperatures as solar panel efficiency falls and transmission networks are pushed to their limit as carrying capacities fall, increasing 'the likelihood of widespread blackouts'. It is a fascinating combination of incentives and outcomes, particularly for a department with 'energy security' in its title. It is also an excellent illustration of why we should be deeply sceptical of government schemes that seek to remake society on a grand scale: the choices to push certain approaches has created this pathway to instability. It is far from the only way in which net zero puts energy security at risk. There are the dark, windless winter days where neither solar nor wind provide significant inputs into Britain's grid, potentially leaving us reliant on backup power sources – an additional source of capital costs – or on interconnectors to European countries, which may also find their generating capacity limited. At the other end of the spectrum, a report into Spain's April blackouts has highlighted that particularly sunny days may drive prices negative, causing producers to switch off in a cascading failure. Britain does at least seem to have learnt this lesson ahead of time, taking steps to prevent a similar incident here. As the UK report has highlighted, however, it would be foolish to assume perfect foresight of future risks. It is surely time the Government put energy security ahead of net zero ideology.

Telegraph

an hour ago

• Telegraph

Marriage Diaries: Should I get a prenup for my second wedding or trust my husband-to-be?

Should you be planning the end of your marriage before you've even tied the knot? This is the question that's been plaguing me for the past few weeks. I'm 58 years old, and next March will be marrying Steve, 60. It will be a second wedding for both of us: I have three young adult daughters and he has a son. Steve and I are taking great pleasure in planning the next stage of our lives together. But – in between conversations about which location would suit our intimate ceremony, and what dress I should wear as a 50-something bride – I can't help but wonder whether we should get a prenuptial agreement. I'm so preoccupied about this decision that it's been keeping me awake at night. I've been fully open with Steve about my dilemma. He's quite relaxed about the subject, and isn't offended (at least, that's what he tells me) but doesn't think a prenup is necessary. I think this comes down to how we both experienced the end of our last marriages. My divorce from my ex-husband came through six years ago. It was nasty and protracted and expensive, mostly because my ex tried to hide money abroad and attempted to bully me into submission when I was hoping to appeal to his – ultimately absent – better nature. In the end, I had to hire a top family law firm. After a draining process – which ended up in court with a finance dispute resolution – I received a fair settlement. But it cost me the best part of £50,000 and a whole lot of tears. On the other hand, Steve's experience of divorce was far more pleasant. He and his wife had an amicable 'no fault' settlement, which barely involved lawyers. His son was also grown up, so it was less traumatic for everyone. After the sale of the London marital home, my children and I moved into a small cottage in West Sussex which I decorated with great care: I feel happy and settled here. I love my current home so much that Steve has agreed to move in with me while he rents out his Yorkshire house. When it comes to our respective finances, Steve and I are comfortable, but neither of us are rich: I'd say that financially, we are in a similar situation. We are both self-employed in the arts world and our properties are worth about the same. Prenuptial agreements didn't used to be binding in the UK, but I've consulted a lawyer who has told me that – done the right way – they can be. The problem is, setting up a legally watertight agreement could cost up to £4,000. My best friend is telling me that I'm being cynical and defeatist. Having known me for most of my life, she agrees that Steve is a far nicer man than my ex. I should embrace this happy new path with joy, she says, and not throw shade on the occasion by being negative. But she hasn't been through the pain of divorce: she hasn't seen how a white-wedding day can turn into a miasma of bitterness and hatred. I'm just not sure I could go through all that again. All I really care about is keeping this well-loved roof over my head, should we separate – this basic security is everything to me. 'We're both nice people,' says Steve. 'In the worst-case scenario we would sort it out, and I would never take your home from you.' But is it naive to believe this statement, uttered when things are at their rosiest? Surely one of the gifts of reaching midlife is learning from experience, and not making the same mistakes again. Should I listen to my gut and instruct a lawyer? Or am I being negative and doomy – and would my time (and money) be better spent on booking a super-luxurious honeymoon?