AIB top men could keep their jobs

ALLIED Irish Banks chief executive Michael Buckley is likely to keep his job, despite the £495m rogue trading scandal at its US subsidiary Allfirst.

Investigator Eugene Ludwig will today unveil his report into Allfirst's foreign exchange losses. Sources say he will not call for Buckley's head. Virtually all the Dublin executive team is expected to escape the axe.

Susan Keating, Allfirst's chief executive, and Frank Bramble, head of AIB USA, are thought likely to depart.

The 40-page report follows an intensive month-long probe. It was presented to AIB's board in two marathon sessions, starting on Tuesday. Ludwig is highly critical of controls at AIB.

Buckley may escape personal blame, but could face an assault from predators. AIB shares initially plunged to 700p after the debacle, but have climbed to 805 3/4p on speculation that it may be a merger target for Bank of Ireland. Royal Bank of Scotland is another possible bidder.

BoI's market value, well below AIB's two years ago, has now overtaken it. Each bank is valued at about 11.5bn euros (£7bn).

BoI chief executive Michael Soden has been arguing that a merger would make sense, and though there are serious monopoly issues some think the Irish government would prefer it to a foreign bid. RBS, keen to expand in America, may be interested in buying only Allfirst.

Analysts say a bidder would have to pay £9bn to £10bn. Mark Thomas, of Fox Pitt Kelton, said: 'There are all sorts of constraints that would make a merger with Bank of Ireland difficult. Soden is signalling to RBS that it would have a fight on its hands.'