THE BOARD of Allied Irish Banks has yet to approve the appointment of David Hodgkinson – the former chief operating officer of UK bank HSBC, selected in a process managed by the National Treasury Management Agency (NTMA) – as its new executive chairman.

Mr Hodgkinson has been approached to lead a new management team but the AIB board must approve his appointment even though the bank will shortly fall into majority State ownership.

Spokespeople for the bank and the NTMA had no comment.

The NTMA manages the Government’s banking bailouts and the State’s interests in five of the six financial institutions in which the Government has controlling or minority shareholdings.

Mr Hodgkinson retired from HSBC, one of the few lenders to survive the financial crisis without government support, after 39 years with the international bank.

He was based mostly overseas in the bank’s Asian and Middle Eastern operations, taking up the position of deputy chairman and chief executive of HSBC Bank Middle East in 2003.

He took over as chief operating officer in 2006.

Born in England in 1950, Mr Hodgkinson will be the latest of three new board appointments at AIB in recent weeks with the departure of senior executives.

Former Intel Ireland chief Jim O’Hara and former JP Morgan executive Catherine Woods were appointed to the board as non-executive directors this month.

The bank said Dan O’Connor, executive chairman, and managing director Colm Doherty would depart after the second Government bailout of the bank was announced last month, as AIB’s capital bill was raised to €10.4 billion by the Financial Regulator.

The bank had been selling overseas businesses and planning a rights issue to raise an initial target of €7.4 billion, but higher losses on property loans will lead to the Government taking a stake of more than 90 per cent.

It is understood Mr Hodgkinson may step back to the role non-executive chairman of the bank after establishing a new management team.