"Large chunks of the senior management" in Irish banks are leaving their jobs for higher pay in banks that are not subject to the €500,000 bankers' pay cap, according to the Secretary General of the Department of Finance.

Derek Moran told the Public Accounts Committee that "cannibalisation of staff" by financial institutions that have arrived in Ireland due to the "Brexit bonus". 

His department has received a report from consultancy firm Korn Ferry. It has been asked to carry out a review of remuneration across bailed out banks.

Mr Moran explained: "We have had a massive increase in the size of the financial system and we have had a lot of cannibalisation of staff in the system."

He said that he has anticipated that the Minister for Finance Paschal Donohoe will be consulted about the report "in the next number of weeks" when the Central Bank has responded to it. 

Responding to questions from Fianna Fáil TD Marc MacSharry, Mr Moran said: "We understand the reason for a pay cap.

"But what is happening is, we are seeing large chunks of the senior management in the banks in which we put shares being taken out and going for much higher levels of pay elsewhere."

He added: "The arrival of large financials from London as part of, if you want to call it, the Brexit bonus is having that effect. It's drawing staff off."

Asked if he would expect a recommendation to remove the cap, Mr Moran said that the Central Bank would like to see stability within the domestic banking sector.

The Department is waiting to see if it is the Central Bank's view that this is providing a threat to the viability and stability of the banks. 1146

Mr MacSharry said the public will be interested to know if the salary caps are to be removed.

Mr Moran said that would be a decision of the Government.