Allied Irish Banks has been forced to ditch plans to pay staff €40m in bonuses after the Irish government threatened to withdraw its financial support.
AIB has received €3.5bn in state aid, and Dublin is set to provide most of the €9.8bn extra capital the bank must raise to fulfill conditions of the €85bn EU/IMF bank bailout. AIB says it promised the bonuses before the financial crisis that brought it to the brink of collapse. It is now facing claims from some staff over the payments. However, Ireland's finance minister Brian Lenihan told AIB yesterday the payouts should not be made "no matter when they may have been earned". AIB's board says in a statement: "Previously the board had received strong legal advice that it was obl...
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