ACCBank confirmed yesterday that it had entered sale contract negotiations with Rabobank Nederland, the Dutch co-operative bank.

The confirmation came in an ACCBank statement yesterday afternoon, soon after the Minister for Finance, Mr McCreevy, had informed the Dβil of the development in his response to a question from the deputy leader of the Labour Party, Mr Brendan Howlin.

"The board of ACCBank have advised me that they are proceeding to sale contract negotiations with Rabobank Nederland. I look forward to receiving the board's recommendation following the completion of negotiations," said the Minister.

It is expected that a sale will be completed within a number of months and possibly before Christmas, subject to successful discussions on issues such as the establishment of an employee share ownership plan.

Details of the price to be paid for ACCBank are yet to emerge but previous estimates have placed the bank's value at between €100 million (£78.75 million) and €250 million.

The State-owned bank made pre-tax profits of €9.34 million after debts and restructuring costs in the first half of this year.

Rabobank has had a presence in the Republic since 1994, when it established an operation in the International Financial Services Centre (IFSC).

It is this company which has been presiding over the bank's bid to purchase ACCBank for the past four months.

According to the bank's website, Rabobank Ireland plc is currently the second-largest foreign bank in the Republic in terms of asset size.

The IFSC business concentrates on corporate finance, corporate banking and investment banking services for both Irish and international clients.

The IFSC operation has a strong focus on the food and agri-business sector.