The Minister for Finance Michael McGrath has further extended AIB's share trading plan into a third phase which is due to end in July.
The Minister said the trading plan has been successful to date in gradually reducing the State's investment in the bank and improving liquidity in its shares.
Proceeds generated from phase two of the AIB trading plan came to about €121.5m and the average price per share achieved was €2.85.
The sale of shares has seen the state's shareholding in AIB reducing from 71.12% at the start of last year to about 57% currently.
Phase two of the trading plan was paused on November 7 for 64 days after the latest AIB share sale by the State, and was otherwise due to end no later than 24 January 2023.
The extension announced today will become operational in the coming days and will now end no later than 23 July 2023, unless further extended by the Minister.
A total of €286.4m has been raised from the AIB trading plan since it was first announced last year.
"Given the success of the AIB trading plan since it became operational a year ago, I can see the merit in renewing the trading plan into a third phase," Michael McGrath said.
"The plan has played an important role in reducing the State's shareholding in AIB to circa 57% currently, and I hope that it will continue to play a role in the future alongside other monetisation options, should they present themselves," he added.
The State pumped €64 billion into the country's banks just over a decade ago following a huge property crash.
It sold the last of its shares in Bank of Ireland last September.
Its stake in Permanent TSB is to fall to 62% from 75% after NatWest took a minority stake in the bank following the completion of its sale of €5.2 billion of Irish mortgages to PTSB in November.
AIB Group chief executive Colin Hunt said the bank welcomed the decision to resume the Government's share trading plan in the bank.
"It is an important development in the process of returning the State's investment in the group," Mr Hunt said.
"The group’s robust balance sheet, its digital capability and the scale of its operations means it will continue to play a key role in supporting the Irish economy and our customers," he stated.
"The focus of our strategy is to grow and strengthen the group to ensure we continue generating sustainable returns for all our shareholders," he added.
