PKO, one of the potential bidders for AIB's Polish arm, is planning a 5 billion zloty (€1.18 billion) bond issue. It Is thought this could be used to help finance its bid for AIB's 70% shareholding in BZ WBK, or Bank Zachodni.

Offers are thought to have been made by foreign lenders including Italy's UniCredit and Intesa SanPaolo, Spanish bank Santander and France's BNP Paribas by last week's deadline.

Poland wants to reduce foreign ownership of its banks, so a domestic offer is likely to be the preferred option.

As part of AIB's €7.4 billion capital raising plan it has to sell its foreign assets.

Previously it was reported that AIB could be planning an institutional placing of its 22.5% stake in US bank M&T if merger talks between M&T and Banco Santander cannot be revived.