Ireland Finance Minister Says No Bonuses For Allied Irish Banks

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Brian Lenihan is finished playing mister nice guy.

Ireland's Finance Minister Brian Lenihan instructed Allied Irish Banks PLC to renege on nearly €40 million ($53.6 million) of staff bonuses after public outcry over the impending payments at the state-supported bank. Mr. Lenihan also defended the government's €35 billion bailout from the European Union and International Monetary Fund against criticisms that it was too small from Anglo Irish Bank Corp.'s chairman Alan Dukes, a former Irish finance minister.

"I'm sorry I have to disagree with him about that but I think he really should look at what Patrick Honohan, governor of the central bank, has said about this," Mr. Lenihan said in an interview with state broadcaster RTE Radio.

Mr. Lenihan's instructions to Allied Irish Banks late Monday contradicted AIB's legal advice that it must pay the 2008 bonuses to 2,400 staff. Mr. Lenihan also cautioned that state support for AIB will be conditional on the bonuses being withheld. "The situation of the bank has changed drastically since the period in which the bonuses were supposedly earned and indeed that the foundations of the bank's problems were laid down in that and earlier periods," Mr. Lenihan wrote in a letter to AIB.

[WSJ}

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