Ireland's financial services industry needs to pull together to avoid its reputation being harmed by internal bickering, said David Went, chief executive of Irish Life & Permanent.

Speaking at a lunch meeting of the Leinster Society of Chartered Accountants, Mr Went, who acknowledged that some individual banks had contributed towards undermining trust in the sector, said the standing of the industry is being harmed by growing cynicism towards its member institutions.

"In the rush to criticise, we have created a distorted caricature of the industry," he said.

"We need the business community to ensure the debate is reasonable and balanced."

Ireland's financial services community plays an important part in the economy, employing 52,000 and contributing about €1.5 billion in taxes each year.

Mr Went's comments follow a report in a US newspaper last week that criticised the regulation of the Irish financial services industry after it was revealed that Dublin-based Cologne Re, a division of US company General Reinsurance Group, was being probed by the New York Attorney General, Eliot Spitzer, as part of a larger investigation into a lack of regulation in the insurance industry.