The chief executive of Permanent TSB has said he thinks the fact that discussions are still ongoing with NatWest about the possible purchase of certain Ulster Bank assets is "very encouraging."

Eamonn Crowley said both sides understand that these discussions may or may not lead to a transaction.

"But I think the fact that we are still very much engaged constructively in this process almost three months on from the original announcement, that demonstrates that both parties want a transaction to happen," he told reporters during a call following the bank's annual general meeting this morning.

Mr Crowley said there has been a lot of speculation about what is in the deal and what is out of the potential deal, but he couldn’t say much yet on that.

He said NatWest, Permanent TSB and Ulster Bank itself are trying to identify areas of overlap between areas of interest.

The PTSB boss declined to say whether current accounts will be included or not in the potential transaction.

It follows media reports that problems faced by the two banks in moving current accounts across from one IT platform to another could mean they will be left out of any deal.

But he said the bank is well used to moving large numbers of customers onto and off its platforms.

Mr Crowley also declined to comment on whether or not tracker mortgages would be included.

"Finding that area of overlap is not a simple exercise and it does require judgement and skill to settle on the appropriate area," he said.

"Indeed, there will be some challenges, no doubt, around executing as successful transaction. But believe me, I know we can do this. As an organisation we have done it before."

He added though that securing a deal with NatWest is not the only strategy being pursued by Permanent TSB and it continues to aim to become Ireland's best personal and small business bank.

"It is clear we are in the midst of massive change in the banking sector," he said, adding that it is positive change for PTSB as it provides opportunity.

Mr Crowley also said it was too early to say what additional external financing might be required to fund a deal with NatWest.

But he added that both the Department of Finance and other private shareholders in the bank are very interested in the transaction and the strategy.

On the question of how long it will take to conclude the talks with NatWest, Mr Crowley said the parties are targeting to get a legal agreement concluded by the end of this year or early next year.