The Irish Bank Officials Association yesterday recommended to Bank of Ireland staff the proposed changes in their pension arrangements, which were brokered recently by the Labour Relations Commission (LRC).

"The proposals from the LRC meet the union's core objectives of retaining the defined benefit scheme for future accrual; preserving members' core benefits and other provisions; and applying change in an equitable fashion across all stakeholders," the association's general secretary Larry Broderick said.

"Viewed against the background of recent developments in pensions within Irish banking and in employment generally, and recognising that protracted engagement has taken place between the union and Bank of Ireland since February, our executive committee believes that the final proposals represent the best that can be achieved by negotiation," he added.

'Mature compromise'
Mr Broderick said the LRC proposals represented a "mature compromise" to the opening positions of the bank and its staff.

“Following a series of consultation meetings throughout the Republic, Northern Ireland and Great Britain, the proposals will be put to our members in Bank of Ireland for their approval in a ballot – which we hope to complete by the end of November,” he added.

Bank of Ireland is set to reduce its pension deficit by up to €400 million, thus securing the future of its defined pension scheme and paving the way for a stronger capital position.

Following the completion of discussions, which began seven months ago, facilitated by the LRC, the bank’s pension deficit, which stood at €1.15 billion as of the end of December 2012, is set to fall as a result of adjustments in benefits.

The solution agreed upon is said to be a “shared” one, in that the bank will reduce the deficit as a result of various measures, and members of the bank’s pension scheme will need to agree to cuts in their benefits.