Nationwide chief to hand back bonus

Irish Nationwide’s long-time chief executive Michael Fingleton tonight bowed to pressure and handed back his controversial €1m bonus.

Mr Fingleton insisted he was legally entitled “beyond any doubt” to the huge pay-out, which he received after the bank guarantee scheme was introduced last September, but that he wanted to end the public row it sparked.

In a statement issued on his behalf, he said he was handing back the bonus because of the impact the controversy was having on his personal life.

“Because of the effect on his family with a continuing 24-hour media siege on his home and also because of his concern for the effect it may have on the [building] society and his respect for its members whom he has served to the best of his ability for the past 37 years, he has decided to voluntarily return the payment received to the Irish Nationwide,” it said.

Mr Fingleton had come under intense pressure to return the €1m or quit his position.

The issue was discussed at this week’s Cabinet meeting and Finance Minister Brian Lenihan later demanded a full report from Government-appointed directors on the bank’s board within a month.

Fine Gael leader Enda Kenny had called for a change in the law to force bankers to hand back improper pay, bonuses or pension payments while Environment Minister John Gormley and senior Green Party colleagues had called on Mr Fingleton to resign.

The building society chief was given the bonus just weeks after the bank guarantee scheme was introduced last September – but Irish Nationwide said the reward was approved prior to the introduction of the protection.

In the statement, Mr Fingleton said the bonus was a “contractual and binding agreement” entered into long before the implementation of the guarantee scheme.

He said he was pleased to note the acknowledgement by Mr Lenihan that he could not be compelled to return the payment.

“However, Mr Fingleton said that having established his entitlement beyond any doubt to the payment, he wished to bring this matter to a conclusion,” the statement said.

Earlier this week, Mr Lenihan met with ’public interest’ directors on Irish Nationwide’s board, Adrian Kearns and Rory O’Ferrall, on the matter.

Board members were also called into the Department of Finance early next week to discuss their future plans for the financial institution.

Tánaiste Mary Coughlan had said the payment had caused ’annoyance’ within Government.