A civil action is being taken against former chief executive of the Irish Nationwide Building Society, Michael Fingleton.
The case is being taken by the special liquidator of the Irish Bank Resolution Corporation, which took over control of INBS and Anglo Irish Bank.
Proceedings have been served against Michael Fingleton and four other former directors of Irish Nationwide in the last 24 hours.
Deputy Business Editor of the Sunday Independent Tom Lyons said two sets of papers had been filed.
"The first part would be that they will try to force Michael Fingleton to return his €1m bonus, which is going to be difficult, but they're going to try to do that," he said.
"The second part is that if they can show that in relation to individual loans, that bad loans should never have been given, they could sue the directors or board, if any of them knew about this, for damages."
After it took over Irish Nationwide, Anglo Irish Bank asked Mr Fingleton to repay the €1m bonus and to return the €11,500 watch he received on his retirement.
Papers were last night served on former Nationwide directors Terence Cooney and Stan Purcell, and former chairman Michael Walsh. RTE reports it is understood the legal action relates to their stewardship of the building society.