Two former Anglo Irish Bank executives have denied allegations that they participated in misleading the Central Bank in 2008, shortly before the bank guarantee was introduced.
One of the executives said he "deeply regrets the language and tone" he used in phone calls at the time.
John Bowe, the bank's then head of capital markets, described the language used as "both imprudent and inappropriate".
It has emerged that the Central Bank was told by Anglo that €7 billion in funding would be needed to stabilise it.
However, a senior Anglo executive said to a colleague at the time that the true cost would be higher.
The revelation came to light in a recording of a phone call obtained by the Irish Independent, which published a partial transcript today.
Both of the executives involved - Mr Bowe and then director of retail banking Peter FitzGerald - have categorically denied misleading the Central Bank.
Mr Bowe said he was not a member of the executive management board of Anglo in 2008 and "therefore I was not a decision maker in relation to either the bank's requirement for funding or negotiations with the Central Bank."
Mr Fitzgerald told RTÉ News that he also regretted the tone of his conversation with Mr Bowe.
The conversation between two Anglo executives happened in mid-September 2008, just days before the State guaranteed all of the Irish banks.
Taoiseach Enda Kenny said this morning he understands the "anger and rage" of people listening to the Anglo tapes.
However, Mr Kenny said he did not want to say anything to prejudice the banking inquiry, which he said would be comprehensive.
He said legislation to provide for an inquiry would be passed by the summer recess and the Government would then decide the best way to proceed.
Noonan believed 'Anglo had a lot to answer for'
Minister for Finance Michael Noonan said he “always believed that Anglo had a lot to answer for.”
He made the comment in Brussels after speaking with MEPs about Ireland's EU Presidency.
Asked about Anglo's initial demand of €7 billion from the State, even though its negotiators knew they needed much more, Mr Noonan said: “I kind of worked out that was happening.”
“I remember Brian Lenihan coming into the Dáil and saying to us €7 billion; then a couple of weeks later it was a higher figure, and a couple of weeks later it was a higher figure again.”
He told reporters he was not aware however conversations had been recorded until he saw the Irish Independent story.
Asked about an inquiry into the banking collapse, Mr Noonan said legislation would be passed before the summer recess “so the inquiry can be established immediately, which is quite timely.”
Shock at Anglo revelations
Speaking in Luxembourg, Tánaiste Eamon Gilmore said he was "shocked" at the revelations.
"I never really believed what we were told about what happened prior to the previous Fianna Fáil government's decision to issue a bank guarantee in 2008, that that story actually stacked up," Mr Gilmore said.
"What we have seen and heard underlines the necessity for there to be an inquiry into what happened prior to the bank guarantee about who said what to whom, about who was influencing whom, about how very key and damaging decisions from the point of view of the country were made," the Tánaiste added.
He said he hoped legislation to enable a formal inquiry would be enacted before the summer recess.
"We need to get to the bottom of how the decisions were made and what was behind them," said Mr Gilmore.
"Remember that these decisions have cost the Irish taxpayers billions of euro, they have resulted in the Irish people having to bear a huge amount of pain over the past five years, and they have resulted in the present Government having to take very painful decisions in order to clean up that mess," he added.
Fianna Fáil's Michael McGrath said the tapes should be referred to gardaí and the Director of Corporate Enforcement.
Speaking on RTÉ’s News at One, Mr McGrath said he believed the tapes reveal that there was a clear strategy at Anglo to set a trap for the State, to lure it and the taxpayers into bailing out the bank and to conceal the full extent of the bank's financial problems at the time.
Sinn Féin's Pearse Doherty said the revelations were "shocking to the core", and that people must be prosecuted for their roles in collapsing the Irish economy.
Strategy discussed in recording
In the recording, Mr Bowe said in relation to dealings with the authorities: "The strategy here is you pull them in, you get them to write a big cheque and they have to keep - they have to support their money."
Mr Bowe said if the State saw the enormity of the funding requirement for the bank up front, it could decide the cost to taxpayers was too high.
But he added: "If it doesn't look too big at the outset - if it looks big, big enough to be important, but not too big that it kind of spoils everything, then, then I think you have a chance."
Mr Bowe has told RTÉ he categorically denied the allegation that he was, directly or indirectly, a participant in misleading the Central Bank of Ireland in September 2008.
He said the talks with the Central Bank focused on obtaining funding for Anglo to allow it continue on an interim basis pending a more stable market, when the bank would be able to re-establish other funding sources and repay the emergency finance.
He said: "We envisaged the relevant period of time to be a number of months before the bank would be able to access sufficient alternative funding."
Mr Bowe also pointed out that the phone call was three days after Lehman Brothers filed for bankruptcy, and therefore took place during a "period of severe and unprecedented market dislocation".
In a statement to RTÉ, Mr FitzGerald said he was not a member of the bank's executive management board in 2008 and was not involved in discussions regarding Anglo's funding position with the Central Bank.
He also stated he was never aware of any strategy to mislead the authorities in relation the Anglo's funding position.
During the conversation, Mr Bowe briefed Mr FitzGerald on meetings with then financial regulator Patrick Neary, and two other Central Bank officials.
Mr Bowe indicated Anglo had been seeking €7 billion bridging financing from the Central Bank.
He also said the Central Bank had been told that Anglo had a substantial number of depositors "all of whom would be very vocal" if the bank got into "difficulties".
Solicitors acting for IBRC, which is in liquidation, wrote to RTÉ requesting that it would not broadcast the recording of the phone conversation between Mr Bowe and Mr FitzGerald.
In the letter, the lawyers said that no person was authorised to disclose the contents of the recording.
Solicitors McCann FitzGerald said it was an "internal" IBRC telephone conversation that took place on 18 September 2008 and its contents were "confidential".