EBS Building Society today raised the prospect of being part of a "third force" in Irish banking, a "super mutual" to compete with Bank of Ireland and Allied Irish Bank.
Media reports had previously raised the possibility of a merger of EBS with the Irish Nationwide Building Society and the banking arm of Irish Life & Permanent but none of the stakeholders have commented on it in public before.
At a news conference for its interim results, EBS said market conditions provided an opportunity to strengthen the mutual sector and it would be important to keep a strong third force in the financial sector.
"Some believe that the future lies in a 'super-mutual' or 'third force' to compete over the longer term with the main Irish banks," it said in a printed presentation for journalists.
"This entity would act as the 'ultimate good bank' and would be built on the tradition of mutuals - building up savings from members and providing home loans."
EBS reported a first-half pretax loss of €8.8 million today on the back of a near €44 million impairment charge.
The building society expects to transfer about €500 million worth of land and development loans to the National Asset Management Agency (Nama), which the Government will give details of on Wednesday.
It also expects to transfer other, performing, loans to Nama which are not land and development in nature, it added.
As a result of the Nama process it will need at least €300 million of government capital, the society said.
Reuters