Former Irish Nationwide chief executive Michael Fingleton has demanded an apology because he was described as a gangster in the Dáil.

The comment was made under Dáil privilege by Fine Gael Chief Whip Paul Kehoe during a debate on the National Asset Management Agency bill on 13 October.

Mr Kehoe referred to Mr Fingleton and former Anglo Irish Bank chairman Sean Fitzpatrick as 'two of the biggest gangsters ever involved in banking institutions'.

This morning, the Irish Independent reported that Mr Fingleton has written to Ceann Comhairle Séamus Kirk demanding an apology for what the former chief executive described as the 'outrageous' and 'misinformed' comments made by Deputy Kehoe.

Deputy Kehoe has written to the Dáil Committee on Procedure and Privileges stating that he will not be withdrawing or apologising for his comments.

The Wexford TD, who is a member of that Committee, said he would be abstaining from the committee's deliberations on the issue.

Mr Kehoe said that he would not be making any further comments on the issue.

Mr Fingleton retired in April after sustained criticism over the payment of a €1m bonus.

He also had a pension plan worth €27m at the time.

There were repeated calls for the bonus to be repaid and he agreed to do so. So far, however, Mr Fingleton has not returned the money and it is understood he first wishes to see a report about his remuneration prepared for the board of Irish Nationwide.