The international business press has delivered a scathing criticism of AIB’s management following the publication of the Ludwig report and has cast doubt on the future of Mr Michael Buckley as chief executive.
Today's editorial in the Financial Timessays the investigation by US banking expert Mr Gene Ludwig has uncovered "alarming findings which identify management failures at the highest levels at AIB". These findings "raise questions about the future of those at the very top of the bank".
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The Ludwig report identified a litany of control failures at Allfirst that allowed FX dealer Mr John Rusnak to run up losses of $691 million. "Many of those failures can be pinned on individuals close to Mr Rusnak in the management chain," according to the
FT
.
"Much more serious, however, was the weak scrutiny by the Allfirst head office in Baltimore and AIB's Dublin headquarters," the paper said.
Casting doubt on the future of Mr Buckley, the FTsays: "Shareholders may be happy for Mr Buckley to continue as chief executive if he finds a buyer willing to pay a premium for control of Ireland's largest bank. Yet they are unlikely to remain happy if the management team is still in place a year hence".
The Wall Street Journaldescribed Allfirst's risk controls as "flimsy".
"The bank's systems for measuring performance were so out of touch with reality that it planned to award Mr Rusnak a bonus of $200,00 for 2001, though this payment was canceled when the trading losses were discovered in early February," the Journalsays.
The FTeditorial concludes "Mr Buckley's days - and those of other top executives in Dublin and Baltimore - are almost certainly numbered".