Rabobank Ireland, the Dutch bank that owns ACCBank, has performed strongly in 2001. Its Irish operations, at Dublin's IFSC, delivered a 15.3 per cent increase in profit to €40.7 million. The figures do not include a contribution from ACC which it bought in February for €165 million from the Minister for Finance.

ACC results will be issued in June. Last year, it reported losses of €21.8 million, which included a €21 million settlement with the Revenue Commissioners for DIRT arrears and penalties. A further €14.4 million was set aside to cover any losses following a review of its loan book.

Rabobank Ireland, whose core business is providing services such as structured finance and corporate banking to international clients, has added €35.9 million to shareholders' funds on the back of this year's performance. The bank has also raised its provisions for potential bad loans to €4.9 million.

Mr Fergus Murphy, managing director of Rabobank Ireland, said this reflected the growth in loans and a more prudent approach to reflect weaker economic conditions internationally. "We are pleased to deliver steady growth during a challenging economic climate. This represents the bank's solid performance during what was a turbulent year."

Balance sheet assets at the Irish operation grew by 12.5 per cent to €18.7 billion, compared with €16.6 billion at the end of December 2000. Rabobank employs around 100 people at the IFSC where it has been based since 1994. Mr Murphy, a director of ACC, said the bank would continue to develop its wholesale banking franchise and expected ACC to be a highly successful part of Rabobank group.

ACC has been completely restructured and its business refocused along more profitable lines. This was in place ahead of the sale to the Dutch bank. It took an aggressive stance to win new business under the Government-backed Special Savings Investment Incentive Account scheme, offering one of the highest rates of interest to savers who opened accounts at the bank.It is understood to have won around 60,000 of these accounts, mainly from new customers.

The acquisitions was Rabobank's first European expansion outside the Netherlands and is being viewed as a test case for further growth. The two bank's are run separately, although Mr Murphy chairs its compliance and risk committee.

A new board comprising four Rabobank appointees has also taken overall responsibility for overseeing this part of its Irish operations.The bank operates two other subsidiaries at the IFSC - De Lage Landen Ireland and Interpolis Capitive Management Services - which work closely with Rabobank Ireland.

Rabobank is the largest provider of financial services in the Netherlands.