Minister for Finance Brian Lenihan has said he is disappointed but not totally surprised that Postbank is to close by the end of the year.
Yesterday, the bank - a joint venture between An Post and French bank BNP Paribas - announced it was closing almost 1,000 outlets here.
Postbank employs around 260 people, but it is understood only 130 of the jobs are in question.
Mr Lenihan said a sustainable banking sector in the future must focus on jobs as well as small to medium sized businesses.
Mr Lenihan made his comment after speaking at the Institute of Taxation annual dinner in Dublin last night.
During his address, he outlined plans for his next budget which he said would require a €3 billion cut to the national deficit.
Mr Lenihan also said that €1bn in savings would come from the capital budget and the balance from taxation and further cuts to public sector spending.
He added there was no scope for raising the marginal rate of tax but that he was considering introducing a new social charge.
