Citibank's decision to more than double the size of its back-office operation in Dublin was last night being viewed as a ringing endorsement of a strategy being pursued with vigour by IDA Ireland and the Tanaiste, Ms Harney.

It will also give another spur to a series of negotiations already underway with other companies based in the International Financial Services Centre considering bringing similar operations here.

More than half of all inward investment in the Republic is now coming from companies that already operate here, and the IDA has targeted the IFSC's financial sector firms for shared services operations.

In September, Andersen Consulting said it would create 350 new jobs in a new European shared services facility. Andersen plans to use the Dublin operation as a showcase for its clients.

Currently, the State is in talks with several large companies based in the IFSC, and is likely to persuade at least one to follow Citibank's lead.

"In our presentations to the banking sector we make a simple argument - a well-structured back office can deliver savings of up to 46 per cent," one IDA source said yesterday.

The cost-cutting element is particularly attractive from the IDA's point of view, because it tends to work as an insurance against the operations being shut down in the event of the company getting into financial trouble.

However, sources said last night the secret weapon in the IDA's arsenal lay in keeping in touch with high-level US executives, even when they moved companies. It is understood that a key Citibank manager, Mr Mark Bloomfield, was first "converted" to the benefits of Ireland by the IDA when he worked for Bankers Trust in 1993.