The Irish Financial Services Regulatory Authority (IFSRA) has set up a committee to conduct an urgent review of the circumstances surrounding directors' loans in Anglo Irish Bank, and the regulatory response to them.
In a statement, the Authority said that following two days of intensive meetings, it has also begun an investigation to determine the treatment of directors' loans in all the institutions covered by the Government banks guarantee, to ensure that proper standards are being observed.
The board said the Anglo Irish loans were first brought to its attention last Wednesday, and that it took a serious view of the issues involved.
Earlier, the Minister for Finance called for an immediate and urgent review of the circumstances surrounding the knowledge of the transactions of the former chairman of Anglo Irish Bank.
Meanwhile, John Gormley said the Financial Regulator needs to explain comprehensively what would appear to be his extraordinary complacency in the face of events at Anglo Irish Bank.
The Minister for the Environment said that to most ordinary people what occurred there was unacceptable and fills them with disgust.
On Thursday, the chairman of Anglo Irish Bank, Sean FitzPatrick, resigned after it emerged that over an eight-year period he repeatedly temporarily transferred €87m in loans that he had with Anglo Irish to another bank.
The bank's chief executive, David Drumm, resigned yesterday.
It is understood that the Financial Regulator became aware of the transactions early this year.
Fine Gael's deputy leader and spokesman on finance, Richard Bruton said that in the wake of the Government's guarantee scheme for the banks, the public needed to know that there was an effective system of regulation.
Mr Bruton said the only purpose of using scarce taxpayers' resources to recapitalise any Irish bank was to restore the availabiilty of credit to households and businesses to underpin economic recovery.
He said Anglo Irish Bank had lost the trust of both the markets, the regulatory system and the wider public and to recapitalise it with taxpayers' money was neither appropriate nor likely to have any impact on credit availability.
