ALLIED IRISH Banks, the almost fully nationalised lender, paid close to €1 million to retain some staff in its capital markets division in London and New York last month.

The bank made the “retention payments” to 30 staff, averaging about €30,000 each, to stop them leaving the bank as their employment was drawing to a close.

AIB said that the payments were not bonuses but were made to hold on to employees as their departures would damage the bank’s business.

“The very high attrition rates in our London and New York offices, resulting from the stronger job markets in those locations, threatened the future viability of our businesses,” the bank said.

“Therefore it was vital that we secured the services of key staff and consequently some retention payments were agreed for those key staff members who agreed to remain with the organisation for specific periods.”

No bonuses have or will be paid for 2010, the bank said.

The Government has pumped €7.2 billion into the bank, taking control of the lender with a 92.8 per cent stake.

The bank requires a further €4.7 billion in a further recapitalisation under the terms of the EU-IMF bailout.

AIB has said this is “likely” to come from the State.

The next capital injection was postponed until after the election by the Minister for Finance Brian Lenihan.

It had originally been scheduled to take place by the end of the month under the terms of the EU-IMF bailout.

Bonuses totalling €17.1 million were paid to overseas staff at AIB’s capital markets division in 2009 after two New York-based staff sued the bank for failure to pay.

Mr Lenihan blocked the payment of €40 million in bonuses for 2008 to AIB capital markets staff in Ireland, despite the High Court ruling in a test case involving a trader at AIB that the bank was legally obliged to pay his bonus.

The Minister had made the non-payment of the bonuses a condition of further financial support from the Government prior to the second bailout of AIB last December.