MINISTER FOR Finance Michael Noonan has not completely ruled out the possibility that AIB Bank may be allowed to exceed its salary cap of €500,000 when appointing its next chief executive.

However, Mr Noonan suggested it was not likely to happen given the recent imposition of upper pay limits throughout the public service.

But in a response to a parliamentary question from Fianna Fáil TD Billy Kelleher, Mr Noonan did not categorically say the Government would veto any attempt by the bank to increase the salary to above €500,000.

“As has been stated publicly by the Taoiseach, a compelling case would have to be made for the Government to consider setting aside this cap taking account of the recent decision on the pay ceilings for CEOs of semi-States and senior public sector posts,” he said.

He also pointed to “the need for social solidarity to be shown by all individuals and sectors for the good of the nation and its recovery from the present challenging circumstances”.

Mr Noonan said he wanted to reverse the situation where the bank had an executive chairman, combining the positions of chairman and CEO because it did not accord with good corporate governance practice.

“The bank has indicated that, in their opinion, based on their search to date the salary cap applying to the post is causing difficulties in attracting suitably qualified candidates to the position and a higher figure may have to be contemplated.

“I am aware that this view is held by others who have an interest in this matter. However, it would be the intention of the Government that the cap of €500,000 would be honoured.”

Elsewhere, Mr Noonan also disclosed that Nama spent some €18 million in consultancy fees from January 2010 to March 2011.