Neary gets €200,000 payment for early retirement

The former Financial Regulator Patrick Neary has received a payment of approximately eight months salary totalling almost €200,000 for agreeing to retire early.

The Minister for Finance Brian Lenihan said the payment had been agreed following independent legal advice and because of Mr Neary's "exclusive availability" to the Financial Services Regulatory Authority for a period of three months.

As a result the Authority has agreed to "to the payment of an additional €151,500, equivalent to six months remuneration, plus an additional two months salary", Mr Lenihan said in a written reply to a parliamentary question from Labour's Joan Burton.

Mr Neary announced his resignation last month following severe criticism of the Authority over its regulation of the banking sector in general and Anglo Irish Bank in particular.

A central criticism was his lack of knowledge of secret loans to former Anglo Irish Bank chairman Seán FitzPatrick at times exceeding €87 million over an eight year period which were concealed from the bank's shareholders and auditors.

Mr Neary said he first became aware of the loans after they were raised wth him in December by the Minister for Finance.

In his reply to Deputy Burton, Mr Lenihan said "having regard to independent legal advice and his exclusive availability to the Authority for a period of three months, the Authority agreed to the payment of an additional €151,500, equivalent to six months remuneration, plus an additional two months salary, to the former chief executive." Mr Neary had two years remaining on his contract when he retired.

This payment totals approximately €200,000 based on Mr Neary's final salary of €285,341. As a public servant he is also entitled to payment of 1.5 times of his final salary on retirement which is equivalent to €428,000.

Mr Neary will receive an annual pension worth half of his final salary or €142,670.

Following the discovery of the extent of director loans at Anglo Irish Bank the Regulator has decided to introduce new rules.

These will require directors to give details of the maximum amount of loans from that credit institution outstanding at any time during the financial year, including connected loans.

Directors will also be required to give an end-of-year balance for their loans with that bank. The new rules come into force on March 1st.