Two senior AIB executives are suing the bank in a New York court, claiming Ireland's largest lender owes them $500,000 (€340,000) in annual bonuses.

Ronald Rapp, executive vice-president for AIB Capital Markets, effectively the number two in New York, and Douglas Marron, who specialises in "transaction-based" real-estate finance, claim AIB breached contracts and violated New York labour laws.

Rapp claims AIB, in late February, clawed back and has since witheld his 2008 bonus of $315,000, while Marron says he is owed a $185,000 bonus.

The complaint, filed in the past fortnight, is embarrassing for AIB because it offers a glimpse into the huge bonuses awarded to executives even as the global banking crisis was enveloping the bank. AIB received €3.5bn in taxpayers' cash in February and, along with other Irish banks, will likely need more capital from public funds.

"Sometime over the weekend before Monday, 2 February, AIB deposited the 2008 bonuses in the bank accounts of Rapp, Marron and other North American employees," Rapp and Marron claim in the court documents.

"On 3 February, AIB attempted to claw back the bonus that had been deposited in Rapp's bank account. Because Rapp had transferred the bonus payment to another account on 2 February, AIB's attempts to retrieve the money failed."

Rapp and Marron claim AIB "clawed back, or attempted to claw back, every earned bonus payment made to employees in North America". They also claim "so many" employees were upset by the clawbacks from their bank accounts, that managing director for Capital Markets in North America, Paul Carey, told staff on 3 February that AIB would repay the bonuses.

Rapp claims he resisted repaying the bonus until, following pressure, he felt "he had no choice but to do so".

"Since February 2009, various members of AIB senior management have admitted that AIB is contractually bound to pay the bonuses," Rapp and Marron claim.

A spokesman for AIB in Dublin said the bank could make no comment on the case.