IRISH LIFE & Permanent has launched an “early bird” offer on its plan to buy back almost €800 million of subordinated bonds for up to 20 per cent of face value.

The lender, which faces majority State ownership, said it would pay the “early tender consideration” of 20 per cent for most of the securities. One series of bonds is excluded from this rate and will be bought at a price of 8.64 per cent.

If the subordinated bondholders miss the early-bird deadlines, which begin on July 16th, they will be paid lower prices of 17.5 per cent and 7.56 per cent respectively, the bank said in a statement to the stock exchange.

The offer is designed to encourage as many bondholders to accept losses on their investments voluntarily.

Minister for Finance Michael Noonan has signalled he will take a harder line if the proposed burning of bondholders by Irish Life & Permanent, AIB, Bank of Ireland and EBS does not result in the expected capital gains.

The haircuts proposed are as high as 90 per cent at AIB and Bank of Ireland and 80 per cent at EBS.

Meanwhile, Irish Life & Permanent also announced that director Roy Keenan will retire from the board once the ongoing review of the structure of the group has been completed.

Mr Keenan was appointed as a non-executive director in October 2006.

The lender also gave details of changes to the membership of various board committees, including those governing auditing, risk and remuneration.