As legislation was passed in the Dail yesterday allowing for the sale of the State-owned Trustee Savings Bank to Irish Life & Permanent, the Government rejected by 67 votes to 60 a final request to give a loyalty bonus to long-term customers, writes Marie O'Halloran.

Once the Bill completes all stages in the Oireachtas it will mark the creation of a Third Banking Force in the Republic. The legislation now moves to the Seanad and then there will be a final motion in both houses of the Oireachtas to consider the details of the final sale of the 200-year-old institution.

Calling for the bonus payment to customers in an amendment to the TSB Bill, Labour's Finance spokesman, Mr Derek McDowell, said its customers had a "greater sense of loyalty and belonging to the TSB than customers of AIB, Bank of Ireland", or other banks. Mr McCreevy said, however, "the customers of other State companies are not shareholders either and such public assets are held by the State on behalf of all the citizens of the country". The most equitable way to proceed was to take the sale proceeds into State ownership.