THE Ulster Bank continues to have a "keen interest" in acquiring TSB Bank, according to group chief executive, Mr Ronnie Kells. An acquisition would be good for both banks, he added.

However, while the prospect of acquiring TSB was first mooted three years ago, Ulster Bank has not been "prepared to stand still" and has expanded its branch network. And "irrespective" of what happens, the bank is allocating £100 million to be spent on capital expenditure over the next five years. Much of this will go on existing and new branches, said Mr Kells. The Ulster Bank has opened Ii new branches in the Republic over the last two years.

The Cabinet is not expected to discuss the sale of TSB until after the summer Dail recess. The three Government parties are understood to be close to an agreement on the future of TSB and the two other state banks, ACC and ICC.