Public interest directors in Bank of Ireland do not report directly to the Minister for Finance, his department or the Central Bank, politicians have been told.

The bank's two public interest directors - Joe Walsh and Tom Considine - appeared before the Oireachtas Finance Committee a day after the bank announced a hike in its credit card interest rates.

The two men told the committee that they have acted in the public interest in their respective roles.

They said there were not given terms of reference regarding their roles as public interest directors when they were appointed.

They said they promoted changes at the bank which were in the public interest in areas of governance, risk structure and compliance with regulatory requirements.

Mr Walsh said Bank of Ireland now has 700 staff dealing with people in mortgage arrears. It is now offering to restructure 400 to 500 home loans a week.

He said that 16,000 home loans had been restructured and over 80% of these home loans are now meeting the new repayment terms.

Mr Considine said peak losses at the bank were not reached until 2010, with an underlying €3.5 billion loss.

He said the bank was hoping to see the end of the loss-making period in 2014.

Mr Walsh told the Committee that he had been paid €80,000 in 2009, €79,000 in 2010 and 2011, and €89,000 in 2012.

Tom Considine said he had been paid €79,000 in 2009, €90,000 in 2010 and 2011, and €97,650 in 2012.

During today's committee hearing, Bank of Ireland's public interest directors were attacked by Sinn Féin for failing to block bonuses of €66m paid to executives when the bank was in receipt of a bailout.

The development, which was disclosed in March of last year, led to the Dáil record being corrected due to original misleading information from the bank. Mr Walsh said he had ensured the Dáil record had been corrected.

Mr Considine also said a decision by the bank to increase credit card charges was unfortunate but the bank had to be put in a viable position.

2,000 AIB staff working in area of arrears

AIB's public interest director and former tánaiste, Dick Spring, said that 2,000 staff at the bank were working in the area of arrears. Mr Spring exited public life as a politician as 2002.

He said that AIB had to lend to ensure a sustainable operating model for the bank, adding that it was complex given the volume of legacy debt that remains.

Mr Spring said that his first board meeting has reduced directors fees by 25%

Between 2009 and 2011 he said he had earned €132,000 in fees.

AIB's second public interest director, Dr Michael Somers, said in his time on the board he had seen significant stabilisation and recovery at the bank.

He said the bank was battling with a perception that it was not lending to the SME sector, adding that the bank was meeting its lending targets.

Dr Somers said he was paid €98,000 in fees in 2010 and €150,000 in 2011, a total of €248,000. He gets additional money because he was on another boardroom committee at the bank.

Mr Spring told the committee that he had communicated with the late Minister for Finance, Brian Lenihan, on at least one occasion. He also said that he had informed the former Taoiseach, Brian Cowen, directly about the scale of the problems at the bank.

The committee also heard that the level of trust between the Department and the Financial institutions was an at all time low when Mr Spring was appointed in 2009. He said in that context, he had communicated directly with the then Taoiseach.

Dr Somers said there were ''no secrets'' and that he had met the Minister on an informal basis in his role. He said he had the Minister's number and the Minister had his.

Dick Spring said his role in AIB was to make sure the bank functioned and that it was lending. He admitted that it has been ''a horrendous journey since the crisis of 2008''. 48 of the top managers who were in the bank at the time of the crisis were now gone and he said the bank's ultimate aim was to repay the taxpayer.

He told the committee that the bank could not get a chief executive officer at the time and a number of chief risk officers were effectively ran out of the place. Mr Spring said AIB very lucky to have secured David Duffy as chief executive back from Singapore and it now had a solid risk management team.

Dr Somers said he was in absolute shock when he saw the billions loaned by the bank to individuals in property and development when, while at the NTMA he had found it difficult to get AIB to participate in the funding of the State.

He told the committee that other than in extreme circumstances, the expectation was that AIB will not need anymore capital from the State.

Sinn Féin’s Pearse Doherty said Mr Spring’s fee as a public interest director was €1,000 per working day on top of a very generous €120,000+ pension from his political career.

He asked him as a socialist what he thought of that. Mr Spring said he thought the payments were reasonable for the time and effort put in.

Following a question from Fine Gael’s Kieran O’Donnell, Dr Somers revealed that only loans for more than €750 million came before the board when he joined the bank.

Dr Somers said he asked that loans of more than €50m come before the board.