AIB to Return €2.25 Billion to Shareholders, CEO Pay Quadruples

Allied Irish Banks (AIB) announced plans to return €2.25 billion to shareholders and significantly increase the remuneration of its Chief Executive, Colin Hunt, following a strong financial performance in 2025. The move comes after the bank completed its return to full private ownership last year.

Shareholder Returns and Buyback Program

AIB is proposing a final dividend of €988 million for 2025, in addition to an interim payment of €263 million made to shareholders in November. The bank has secured regulatory approval for a €1 billion share buyback program, set to launch immediately as reported by the Irish Times. This combined distribution totals €2.25 billion for the year.

Financial Performance in 2025

The proposed payouts follow a net profit of €2.14 billion for AIB in 2025, slightly down from €2.35 billion in 2024. This decline was primarily attributed to a 9% decrease in net interest income, reaching €3.75 billion, due to falling official interest rates according to the Independent. Despite this, net interest income exceeded management’s upgraded guidance of €3.7 billion from November.

RBC Capital analyst Benjamin Toms noted that the bank’s underlying pretax profit of €1.17 billion for the second half of the year surpassed consensus estimates by 7% as reported by the Irish Times.

CEO Remuneration Increase

With restrictions on fixed salaries lifted following the government’s sale of its remaining shares in AIB, the bank plans to substantially increase Colin Hunt’s pay. His annual salary was initially raised to €795,000 in August and further increased to €1.35 million in January, aiming to align his compensation with market norms as detailed in AIB’s annual report.

AIB intends to utilize fixed share awards, without performance conditions, to circumvent existing bonus limitations of €20,000 for Irish banks. These awards could potentially increase Hunt’s total remuneration to €2.7 million, 5.4 times his 2024 pay.

Looking Ahead

AIB anticipates net interest income to reach €3.88 billion in 2026, with other income exceeding €750 million. Other income in 2025 reached €756 million. CEO Colin Hunt stated the bank’s focus remains on completing its current strategic cycle and planning for the future, despite geopolitical uncertainties as reported by the Business Post. Gross loans increased by 3% in 2025, driven by strong performance in the international climate capital business.

Shares in AIB rose by 1.9% in early trading in Dublin following the announcement according to the Irish Times.