Bank of Ireland selects former executive Myles O’Grady for top post

Bank of Ireland’s board has selected the group’s former chief financial officer Myles O’Grady to become its next chief executive, just months after he left the lender to join Musgrave Group, the food wholesaler and retailer.

It emerged two weeks ago that Mr O’Grady (53) was stepping down as chief financial officer of Musgrave, a little over four months after he joined the group from Bank of Ireland, to pursue a “unique leadership opportunity”. This prompted speculation that he was being lined up to succeed the bank’s outgoing chief executive Francesca McDonagh.

Sources have confirmed that the bank’s board, led by chairman Patrick Kennedy, has picked Mr O’Grady to become its chief executive, subject to him clearing a vetting process by regulatory officials from the European Central Bank and Central Bank of Ireland.

Meanwhile, Bank of Ireland is expected to announce the appointment of Gavin Kelly, chief executive of its Irish retail banking unit, as its interim group chief executive in the coming days. Ms McDonagh is set to leave the group by the end of the week after five years at the helm, to become group chief operating officer at embattled financial giant Credit Suisse.

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A spokesman for Bank of Ireland and spokeswoman for the Central Bank declined to comment on the interim or permanent chief executive appointments. Attempts to secure comment from Mr O’Grady were unsuccessful.

The change at the top of Bank of Ireland comes as the Government is expected to cut the State’s stake in the lender to zero in the coming months. Minister for Finance Paschal Donohoe has reduced the holding in the past 14 months from 13.9 per cent to below 3 per cent — taking it from being the bank’s main shareholder to outside the top 10.

[ Cantillon: Bank of Ireland opts for continuity candidate — of sorts — as new chief executive ]

Potential salary of €950,000

While the bank has actively lobbied the Government to ease executive pay restrictions and an outright ban on staff bonuses, after returning €6.5 billion to taxpayers following a €4.8 billion crisis-era bailout, there is little prospect of this happening in the near term.

Bank of Ireland publicly blamed the pay caps when Mr O’Grady announced late last year that he was quitting. Still, if he were to secure a salary along the lines of the €950,000 earned by his predecessor, it would be double what he was earning as the bank’s CFO.

Mr O’Grady, who was previously a top finance executive at AIB, joined Bank of Ireland in June 2019 in a senior finance role. He was appointed chief financial officer in October 2019 and a member of the board the following January.

He was heavily involved in AIB’s return to the stock market through an initial public offering (IPO) in 2017 as its group director of finance and investor relations, before quitting the second-largest bank by assets in the middle of 2018.

He subsequently took on the role of chief financial officer at housebuilder DRes which was being lined up at the time for flotation.

US private-equity giant Lone Star and Patrick Durkan, managing director of Durkan Residential, were behind DRes. However, the transaction was put on ice in late 2018 and Lone Star decided to develop its massive Irish land bank that it was planning to roll into the IPO through its own housebuilding unit, Quintain.