ICS Building Society expects significant future growth to result from the increasing practice of securitising mortgages.

The society's Mortgage Service Centre is specially designed to handle securitisation and it expects the centre to give the society a competitive advantage over other financial institutions as the level of securitisation grows.

Securitisation is where a financial institution sells a part of its loan book to an investor and gets liquidity in return. The investor still needs to have the loan book processed and this is where ICS says it can provide a service at its multimillion pound centre where 140 people are employed.

"Securitisation is huge business in the United States and parts of Europe and as it increases in Ireland and Britain, ICS is well placed to take advantage," said Mr Donal Heylin, director of operations at ICS. He was speaking after the society's annual general meeting held in Dublin yesterday.

He pointed out that on a securitised loan book of £300 million, net fees of £7.5 million could be generated for ICS. He said he was not aware of any other financial institution in the Republic able to provide such a service in a purpose built centre.

"Levels of liquidity are still high enough in Ireland for securitisation to be fairly limited, but the advent of EMU will mean this is where the action is," said Mr Heylin.

Mr Heylin said he would be "delighted" if more Irish financial institutions securitised their loan books as this would considerably benefit ICS. However, he did not see this happening in the short term.

Mr Heylin said the society's immediate priority was to build up its network of Mortgage Stores. A new store is opening in Waterford this week and two others in Swords, Co Dublin and Bray, Co Wicklow are due to open before the end of the year.

He said the trend of demutualisation in the building society market would not have any great effect on ICS. "We have heard EBS saying that its decision to remain mutual will mean it can give borrowers and savers a better deal, but that leaves them with the problem of how to re-invest in the business," he said. "We do not see ourselves as either price leaders or price laggers," he added.

The publication of the Bacon Report on house prices was welcomed by Mr Heylin, who said it would have a positive effect on the property market.

"These measures should ease the pressure on first-time buyers, not necessarily because of the stamp duty changes, but more because of the provisions for increasing the supply of land," he said.