Bonus and pay cap drives Bank of Ireland executive to pastures new

Restrictions on executives’ pay has driven a top dog at one of Europe’s largest retail banks to quit his job.

Myles O’Grady has left his role as chief financial officer at the Bank of Ireland, citing limits on bankers’ pay and bonuses as the main reason for leaving.

O’Grady quit to capitalise on a better-paid job at Musgrave Group, an Irish wholesaler.

Bank of Ireland chief executive, Francesca McDonagh, slammed a cap on executives’ pay as a barrier to attracting talent in the wake of O’Grady’s departure.

“Myles’ decision to leave the Irish banking sector highlights the challenge that remuneration restrictions represent for Irish banks in attracting and retaining talent,” McDonagh said in a statement.

Before his job at Bank of Ireland, O’Grady held senior roles at Citibank, Bord Gais and AIB Group.

Bank executives’ pay was capped at €500,000 a year during the Eurozone’s banking crisis.

The bonus cap was introduced in January 2014 in the UK and was part of a reaction to the financial crisis of 2008 when many bankers received multi-million rewards despite huge losses within a bank. Currently, payouts are restricted to 100 per cent of salary or 200 per cent, with approval from shareholders.

The Bank of England’s Sam Woods, who heads the banking watchdog Prudential Regulatory Authority, said last week scrapping a cap on bonuses was not a priority.