Bank of Ireland has re-introduced bonuses just months after the Government relaxed restrictions on banker pay.

The bank, which became fully privatised last September, said it will give employees a share of profits in April 2024 in addition to normal pay and benefits.

The scheme will be based on both the operating performance of the company and individual performance during 2023.

The new bonus pool is part of an overhaul of pay at the bank which includes increases to entry level salaries, a base pay hike of 1.5pc for all staff, the introduction of a benefits allowance, and new cost of living payments.

““Looking to the future, and as a fully privately owned company, we ant to use an element of performance related pay to attract and retain the people we need to deliver great outcomes for customers and grow our business,” said Matt Elliott, Bank of Ireland’s chief people officer.

“This is normal business practice, and our new profit share scheme will allow us to compete on a more level playing field with a wide range of other employers.”

Bank of Ireland was the foremost critic of the bonus ban and pay caps for bankers, with former chief executive Francesca McDonagh arguing vociferously against the restrictions on compensation.

Ms McDonagh, who lost several top executives to better paying jobs in other industries during her tenure, took a senior role at embattled Swiss bank Credit Suisse last year for a significantly higher salary than she earned in Ireland.

Among those was current chief executive Myles O’Grady, who left Bank of Ireland for what turned out to be a short stint as chief financial officer of Musgrave.

Last November the Government relented somewhat on pay restrictions, allowing limited bonuses for staff up to €20,000.

Bank of Ireland’s announcement on pay follows other recent improvements to parental leave, fertility treatment and other family-friendly policies.