The Allfirst treasury operation never received any instruction or communication from AIB to sell dollars or buy yen, according to the head of AIB Capital Markets, Mr Colm Doherty. Any market speculation to this effect was "absolutely and unequivocally untrue", he commented.
Stressing the AIB Capital Markets division had no responsibility or management control in relation to Allfirst, Mr Doherty said his division managed prudential liquidity for AIB, wholesale propriety trading and customer business for Ireland and the UK.
The Allfirst operation had its own treasury division, with its own management, reporting to the Allfirst chief executive's office and board.
Asked whether this was not an unusual and risky reporting structure for an overseas subsidiary, Mr Doherty said this was a question for the group.
Asked if there was any central group control over the Allfirst treasury operation, a group spokeswoman referred to the reporting lines set out in page 21 of the AIB annual report.
Setting out the organisational structure for managing market risk, the report said the main committees involved were the group executive committee and the group asset and liability credit committee.
The report continues: "The group continues to progess towards a more integrated approach to risk management ... There is a group-level risk management unit independent of the divisions, whose core objective is to enhance shareholder value by promoting efficient risk-taking across the group..."
This unit reports to the group treasurer who is a member of the group executive committee. The group asset and liability credit committeesets and reviews the group's asset/liability strategy within risk policies approved by the board.
It consists of senior management from each of the divisions and from the group, and is supported by asset and liability committees in AIB Bank, Allfirst and Poland.
