Bank of Ireland averts strike with cash offer

DUBLIN, July 3 (Reuters) - Ireland's banking union said on Thursday that it had suspended a 24-hour strike at Bank of Ireland (BKIR.I) planned for July 8 after the company agreed to increase the size of a bonus package for employees.

Members of the Irish Bank Officials Association (IBOA) had voted to hold a strike to coincide with Tuesday's Bank of Ireland shareholder meeting because they said the bank wanted to withhold half of staff's bonus share package for this year.

In response Bank of Ireland (BKIR.L) has said the size of the stock bonus, worth more than 20 million euros ($31.8 million), reflected the fact that the group had met its cost management target but not its earnings per share goal last year.

In May the bank indicated that earnings would fall in the coming year with the slowdown in the Irish, UK and U.S. economies taking their toll.

The bank has already awarded 3 percent of each employee's salary for the year to end-March in Bank of Ireland shares, IBOA said, but the union had been demanding 6 percent.

After mediation by the head of Ireland's Labour Relations Commission, the bank agreed to pay an additional 3 percent in cash in October, instead of further share options, IBOA said.

"The proposals are of sufficient weight to require full consideration by our members," IBOA General Secretary Larry Broderick said in a statement.

"So we are deferring the action in the Republic planned for Tuesday -- and suspending plans for a formal ballot on industrial action in Northern Ireland and Great Britain."

Broderick said the IBOA would now ballot members on the settlement proposals.

Bank of Ireland said in a statement that it welcomed the association's decision to suspend strike action.

(Reporting by Andras Gergely; editing by Elaine Hardcastle)