Mr. Mike Aynsley:

Unfortunately, this ran against the grain of what became the preferred position of the Department from March 2011 onwards of a more directive relationship based on a high degree of integration with the Department.

Notwithstanding the change in tack by the Department, the bank made significant progress against its targets by all measures. This included management through a period of unprecedented market turmoil whilst dealing with multiple high-profile legacy issues. It included building a new leadership team and driving significant changes in the broader organisation, including overhauling of risk functions and establishing new governance and control processes. It included conducting a thorough due diligence of NAMA bound and post-NAMA loan portfolios to identify the true quality and value of the underlying assets, establishing asset and loan recovery strategies and setting up specialist work-out units to proactively resolve distressed loans, maximise recovery and, where appropriate, restructuring loans so as strengthen and improve asset quality.

The bank was also involved in supporting the Irish authorities' and the international authorities' broader restructuring of the bank and the Irish banking landscape. This work was central to the task of working through multiple alternative paths which ultimately led to the ... Anglo and INBS being placed into wind down. And, of course, we have successfully ... we have successfully executed the acquisition of INBS and downsized the total asset portfolios from pre ... pre-crisis highs of over €100 billion plus to some ... in total assets to a point where the net loan levels were around the €15 billion mark at the point of special liquidation. This included the sale of the substantial US-based loan portfolio in what was the largest single open market sale in the USA since the collapse of Lehman Brothers.

In summary, I feel fortunate to have worked in Ireland during the challenging period and to have been associated with a world-class team consisting of a very talented ... board and management team. If I have any immediate concern about what went on during the period, it is simply that I'm not certain that all valuable lessons have being learned with regard to the need to separate banking policy and operations functions within the State. My experience with the Department of Finance makes me worry that it is likely that the Department will not only continue to direct banking policy but also look to take an active role in directing operations and the regulatory function. In part, this approach was a significant contributor to the breakdown of the banking sector in Ireland.

As Ireland continues to move forward in its recovery, I wish it well and hope the outcomes of this banking inquiry and the very important work you're doing can productively be used to safeguard the sustainability of the financial sector for the future. Thank you, Chairman.