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The decision to leave Bank of Ireland CFO Myles O’Grady leaves two of the state’s remaining retail banks in search of a top-quality bean counter.
The permanent TSB (PTSB) has had to settle for a temporary CFO since the previous incumbent, Eamonn Crowley, took the top job in June of last year.
Grant Thornton’s associate Paul McCann has competently filled the post on an interim basis over the past year, although his workload has increased significantly as the PTSB seeks to increase its balance sheet by 50% with part loans from Ulster Bank.
But the delay in closing the gap shows how difficult it is to find someone who is qualified and experienced enough to take on a senior banking position with salary restrictions in place – and how banks find it extremely difficult to do so. ‘get a yes or no from the Central Bank as it reviews the most important appointments in the industry.
The Bank of Ireland was for a time more than happy to see AIB publicly complain – and take the heat – about the “unfairness” of the wage cuts and bonus bans, a legacy of the bailouts of the industry in times of crisis.
‘Training ground’
Attendees at a 2018 Banking & Payments Federation annual conference will recall how Bank of Ireland chairman Patrick Kennedy kept the schtum when his then AIB counterpart Richard Pym explained how the restrictions pay had turned his business into a “training ground” for bankers who then moved on to better paying positions elsewhere.
Pym’s chief financial officer, Mark Bourke, had just resigned and, although he didn’t know it at the time, its chief executive, Bernard Byrne, would be giving his notice in a few weeks.
Driven by retention issues at his own bank, Kennedy more recently used his annual report to bemoan the restrictions. More recently, in March, he argued that the bank should be exempted from the bonus ban because, unlike AIB and PTSB, it repaid a € 4.8 billion bailout to taxpayers.
With the bank blaming the restrictions on O’Grady’s exit, it highlights the problem for investors as the government seeks to sell its remaining stake in the bank. Proxy consultancies have long made it clear that they want Irish bankers’ compensation to be linked to performance in order to promote good governance.
It’s all well and good. But there is no vote for a finance minister to propose easing restrictions – especially in the current political environment.
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