Standard & Poor's has followed Moody's by raising its rating on Permanent TSB in the wake of the bank's securing €525 million in capital. The ratings agency said the initiative, when combined with the bank's internal restructuring, had "substantially reduced downside risk" in relation to capital and risk.

Standard & Poor’s also noted a “significant improvement” in Permanent TSB’s liquidity position. It said it would affirm its B+/B ratings on the bank and remove them from the negative watch it imposed in October last year.

“The positive outlook reflects our expectation that we could raise the rating in the next one to two years if the bank continues to improve its pre-provision earnings capacity and statutory profitability on the back of continuing macroeconomic recovery in Ireland,” Standard & Poor’s said.

Permanent TSB last night welcomed the ratings move. "Through the past week we have received positive ratings updates from Standard & Poor's, Moody's and DBRS. The common message is that the outlook for the group is significantly improved following the very successful completion of the recent capital raise," said Paul Byrne, Permanent TSB's group treasurer.