Allied Irish Banks (AIB) chief Bernard Byrne is stepping down, the bank said on Friday, becoming the most high profile executive to leave the lender that has blamed staff retention problems on a government-imposed pay cap.

The departure of Byrne, whom the bank said would leave next year, leaves AIB looking for a new chief executive as well as a chief financial officer (CFO) after Mark Bourke said last month he was leaving the bank.

"It was a very grim day in my life when Bernard told me that he had an external opportunity which he wanted to pursue. The fact that it came so soon after the resignation of our CFO made it doubly difficult," AIB Chairman Richard Pym said in a statement.

The bank did not say what new post Byrne had lined up and the departing CEO could not immediately be reached for comment.

AIB said last year it feared in particular losing staff to international banks that are moving operations to Dublin as a result of Brexit, and do not fall under the cap on executive pay and ban on bonuses that Dublin introduced a decade ago.

Pym told a conference last week that the restrictions on the country's domestically owned banks had turned AIB into a "training ground" for competitors.

The bank sought to introduce a deferred share plan for senior executives earlier this year, but it was voted down by the government, which retains a 71% shareholding following a 2017 initial public offering (IPO).

While Irish Finance Minister Paschal Donohoe acknowledged the restrictions could act as a barrier to the retention of some staff and launched a review of banking remuneration policy, he said the current policy remained appropriate.

Donohoe thanked the departing CEO in a statement, saying Byrne would leave AIB in a much stronger financial position as outlined in a trading update on Friday, in which the bank said it was on track to deliver on full-year expectations. (Reuters)

Source: www.businessworld.ie