Dáil Éireann Debate, Tuesday - 20 November 2012
219. Deputy Pearse Doherty asked the Minister for Finance further to Parliamentary Question No. 205 of 13 November 2012, if he will confirm that a €440,000 average payment to the pension fund in respect of each of the 2,500 roles at Allied Irish Bank identified for redundancy was required in order to secure the voluntary redundancy of each of the 2,500. [51372/12]
View answerI have been informed by AIB that the transfer of the €1.1bn portfolio of loan assets was made using arm’s length valuations by two independent external parties and was agreed by both the Trustee and the Board of the Bank. There was a very significant discount to the nominal value of €1.1bn. The transfer of these assets to the pension fund was needed in order to facilitate the early retirement component of the voluntary severance program of the bank. The early retirement scheme created a Minimum Funding Standard deficit in the pension fund which was bridged by the transfer of the assets. Had the transfer of assets not taken place, the early retirement component of the voluntary severance could not have proceeded as it would have required a cash contribution from the bank.
The voluntary severance scheme in the bank overall is expected to result in annual savings to AIB in excess of €200m which is a critical component of AIB’s long term return to viability.
