Two senior executives at finance house Irish Life & Permanent resigned today in the wake of a scandal over money paid into Anglo-Irish Bank, boosting the lender's annual returns.
Group finance director Peter Fitzpatrick and head of group treasury David Gantly both quit over €8.2bn in controversial deposits paid into the now nationalised bank as it finalised its yearly accounts last September.
However, a resignation offer from chief executive Denis Casey was turned down at a late-night board meeting.
The casualties followed an hour of talks between board members and Finance Minister Brian Lenihan in Dublin yesterday.
IL&P chairwoman Gillian Bowler said: “I have absolutely no doubt about the integrity of the individuals concerned.
“However, in providing support to the broader financial infrastructure, mistakes were made — for which I and the board apologise unreservedly.”
In a statement IL&P said: “The board has expressed its strong disapproval of and disappointment with some of the specific measures used to support Anglo Irish Bank during 2008.”
The finance house said the only motivation behind the money moves was to assist the wider banking sector after a call for support from Ireland's financial regulator and the Central Bank.
IL&P said Mr Fitzpatrick and Mr Gantly had acted in good faith.
Earlier this week Mr Lenihan revealed that the transactions had been identified by auditors at PricewaterhouseCoopers after they were brought in to inspect banks following the Government's deposit guarantee scheme. Mr Lenihan admitted he had not read the report in full.
Although auditors spotted the €8.2bn (£7.3bn) moving in and out of IL&P and Anglo they did not flag it up as unusual to Department for Finance officials and Mr Lenihan said he was unaware of it until the Government stepped in last month to nationalise Anglo.
IL&P detailed the transactions — known as “bed and breakfast” or “warehousing” in some banking circles — which occurred in March and September last year.
The first payment, worth €750m (£670m), followed a request from Anglo last March. It was an overnight deposit on March 31 and followed a €1bn cash payment into Permanent TSB, a branch of IL&P.
Six months later, Anglo made another request. IL&P paid a total of €3.45bn (£3bn) in five separate deposits between September 26-29. At the same time a similar sum was lodged in Permanent TSB.
The transactions matured on the October 2 and 3, IL&P said.
Three further requests for money on September 29 were refused as Anglo could not offer deposits in return.
The next day, as the Government introduced its bank guarantee scheme, Anglo asked for more cash. IL&P agreed and paid in €4bn (£3.6bn) overnight and it received the same amount at Permanent TSB. The transactions matured on October 1.