Bank of Ireland is still firmly setting its sights on further acquisitions in the British market, and would ideally like to buy another building society. Group chief executive Mr Pat Molloy said the search for suitable acquisitions in Britain would remain a "top priority" for the bank. The British market was the "most logical" place for Bank of Ireland to seek to develop, he said. Its building society, Bristol & West, gave it a platform to expand, he maintained.

"We will be looking for good value for shareholders and will not be making any acquisitions for the sake of it. Another building society would be a very sensible way to go but such acquisitions are very highly priced at the moment," Mr Molloy said.

The bank is well pleased with the performance of Bristol & West, which it purchased for £600 million earlier this year. Its first contribution to the group's pre-tax profits has been well ahead of expectations with its relatively low-risk mortgage business showing solid growth.

Mr Molloy said the bank was more immediately concerned with completing its £273.6 million acquisition of the New Ireland life and pension business. The bank, he said, was acquiring an "excellent brand" that would allow it to expand in that section of the market.

There has been some speculation that the deal may yet be referred to the Competition Authority because of the scale of the Bank of Ireland group's business in the Republic.

Responding to that suggestion, Mr Molloy said that it was becoming increasingly difficult for the bank to acquire further businesses in the Irish market, but insisted that, because its share of the life and pensions market was still relatively small, the deal may be able to bypass the authority.

"We currently have around 4 per cent of the life and pensions market and even with New Ireland, it doesn't take us to a level that should cause any competitive problems," he said. The bank, which lost out to Irish Life in buying one of Hungary's former state banks, would also continue to look for suitable acquisitions in Central Europe, he said.

Another pressing issue for the bank is coping with the implementation of the new single currency and adapting its computer systems for 2000. Substantial costs will be incurred.

Mr Molloy said the bank was already well advanced in adjusting its computer systems, and had provided around £30 million over the next three years for this project. Bank of Ireland has earmarked a further £25 million to £30 million, spread over four years, to adapt all of its equipment to the new currency. The loss of substantial foreign exchange revenues will also dampen profits. "The revenue losses are very much less for as long as sterling stays out of European Monetary Union." The British currency accounts for about two-thirds of the bank's total foreign exchange revenues at the moment.