Speculation that the Bank of Bermuda might be bought up by banking giant HSBC began long before the sale was announced last month.

In July, BIU president and PLP backbencher Derrick Burgess claimed that the bank was in talks with the bank and that Government had been part of those discussions. At the time it denied by then Premier Jennifer Smith.

Last month, the speculation was confirmed and Mr. Smith told this week that keeping the deal under wraps had been a big headache.

Mr. Smith said talks with Government, for which he had solid praise, began in February or March and carried through to last month: ?The biggest job was dealing with Government. And there were times when I thought if this is not going to happen let?s forget it and get on with life. But in the end, the proposal was made, our board agreed it and Government supported it.?

But when asked if the information being leaked outside the confines of the Cabinet and the Ministry of Finance had been difficult, Mr. Smith said he was frustrated, angry even and wished he could have said something. ?It was all of those things. We were dealing with Cabinet and the Ministry. And we (all) were doing everything possible to keep a lid on this thing,? he said.

Mr. Smith continued: ?I have no idea to this day how Mr. Burgess got the information that he thought he had. Who knows. There were a lot of people involved in this in Government and in the bank and in HSBC, so who knows where it came from. But the fact that he made the comments that he did was pretty frustrating, as all we could say is ?no comment?. I couldn?t say yes, as we didn?t have a transaction agreed and we didn?t have Government support and I couldn?t say no because we were talking. It was unfortunate and I think he (Mr. Burgess) embarrassed a few people in Government when he did that, but you know that was what was done and we live with it.?