Despite a warm welcome to Cork yesterday, AIB's directors found most of the thornier issues that they have had to deal with recently travelled with them.

About 500 people arrived at the Rochestown Park Hotel in Douglas for the first annual general meeting of the bank to be held outside Dublin.

The bank has its roots in Cork - it grew out of the Munster & Leinster bank - and many of its current and previous board members are from the area.

AIB chairman Mr Lochlainn Quinn opened the meeting, telling shareholders that Cork was the "logical" place for them to gather.

About 27 per cent of its shares are held in Munster and it retains a substantial customer base in the area.

Mr Quinn moved to address the difficult questions which were always going to arise - claims regarding the number of bogus non-resident accounts held at the bank in the 1980s and its treatment of debts owed by two former Taoisigh.

"1998 was AIB's best year financially but there were also one or two downsides," he said. The issue of unpaid deposit interest retention tax (DIRT) on bogus non-resident accounts held at the bank is being assessed by a firm of independent accountants appointed by the Comptroller and Auditor General.

The firm's report is expected to be issued later this year, he told shareholders. But contrary to the view of the Revenue Commissioners, he stressed that the bank did not believe it had any outstanding tax liabilities in that regard.

"Our position all along is that we had an arrangement with the Revenue Commissioners that covered the periods between 1986 and 1991. We are co-operating with the Comptroller and Auditor General's investigations. Whatever conclusions are reached, we will fully comply with," Mr Quinn said.

The bank also hit the headlines over its treatment of the debts incurred by Mr Charles Haughey and Dr Garret FitzGerald. The chairman acknowledged the "Charlie Haughey loan" but said he was unable to comment further on the matter as two of the bank's former directors still had to appear before the Moriarty Tribunal. Client confidentiality was also cited.

Shareholder Mr Dave Johnston was the first dissenting voice. He asked the bank to apologise publicly for any collusion on its part regarding tax evasion. He formed part of a small group of disgruntled shareholders who dominated proceedings.

Mr Quinn's impatience with their outbursts became evident early on and made for some terse exchanges during the 21/4-hour meeting.

The chairman's attempt to cut off the microphone as another shareholder, Ms Geraldine O'Boyle, tried to finish her contribution drew strong criticism. Ms O'Boyle told Mr Quinn she had been an AIB customer for 28 years and believed she had a right to raise her concerns.

As is usual, the bank sought to impose a limit on the contributions shareholders could make on each proposal, but the audience took the chairman to task.

One man reminded board members that they were paid to attend the meeting and insisted that shareholders were not in any great hurry.

MEP Ms Bernie Malone, who had obtained a proxy from an AIB shareholder, asked the board if it was still the bank's policy to recognise and seek out customers it regarded as "key business influencers" for special treatment.

AIB told the Moriarty Tribunal that Mr Haughey was in this category and this factor was taken into consideration in its decision to write off £400,000 of his debt to the bank. "How many privileged people do you have on your books and what is your attitude towards small account holders?" Ms Malone asked.

Mr Quinn said he first learned of such a term when it was mentioned at the tribunal. "As I understand it, it goes back some time and no such phrase is currently used by the bank."

AIB was in the business to make money for its shareholders, he added. "When we lend money, we expect to get it back across the board." Over the past five years, he said, AIB had written off £100 million a year, and that was at a time when it was performing well.

"Our policy is the same for everybody: what we lend out, we expect to get back," Mr Quinn stated.

The bank's long-standing dissident shareholder and former employee, Mr Niall Murphy, tested the chairman's patience with a continuous barrage of invective. He accused the bank of continuously misleading shareholders and the public.

Mr Quinn repeatedly clashed with him and urged him to get to the point or refrain from personal abuse.

Mr Murphy in turn urged him to "relax" and "get a grip".

Mr Murphy's group put down a motion calling for the resignation of director Mr John McGuckian, group chief executive Mr Tom Mulcahy and Mr Quinn. The motions were all defeated, as was one which proposed Mr Murphy's election to the board of AIB.

By the end of the meeting, most shareholders were on the chairman's side and were openly groaning and calling for an end to Mr Murphy's contribution. One suggested that Mr Murphy should consider selling his shareholding in AIB to ease his burden.

In concluding the meeting, the chairman could report that all the motions had been carried by 98 per cent of shareholders. He is no doubt already looking forward to next year's a.g.m.