Bank of Ireland approaches Abbey National

Bank of Ireland has approached troubled Abbey National with plans to create a London-listed bank with headquarters in Dublin, it was announced today.

In a statement to the London Stock Exchange, Bank of Ireland said it had made a “preliminary approach” to Abbey in relation to a possible combination of their businesses.

The bank said: “The combination proposed by Bank of Ireland would involve the establishment of a unified corporate structure with a primary listing on the London Stock Exchange, the retention of a listing on the Irish Stock Exchange and with its head office in Dublin.”

A merged bank would be valued at €18bn on the stock market, and if a deal goes ahead, is expected to be led by the Irish bank's chief executive Michael Soden.

It is thought the Irish bank wants to combine Abbey’s UK branch network with Bristol & West, the former building society owned by Bank of Ireland.

However, Abbey was today expected to reject the approach as “opportunistic”.