Shares in PTSB surged over 20% after the State-controlled bank announced it has put itself up for sale.
The bank said its operations, products and services will not be affected by the move, and it will continue to support and service customers as normal.
The board said it believes launching a so-called Formal Sales Process (FSP) could identify a new long-term owner of the bank, which could be beneficial for shareholders, customers and workers.
In recent months, the bank said it has seen a significant increase in appetite for its shares from international investors.
PTSB had a market value of €1.29 billion before the announcement, following a 63% surge in its share price this year up to the end of trading yesterday.
"Given the robust economic backdrop and increased investor appetite in PTSB shares, the board is of the view that now is the right time to seek a new long-term owner for the bank that will enable PTSB to unlock its potential for further growth and scale," said Julie O'Neill, Chair of PTSB.
"If successful, this Formal Sales Process (FSP) would result in the exit of the State's last remaining shareholding in the Irish banking sector and, most importantly, return capital to the State and taxpayers," she added.
State holds 57.4% stake in PTSB
PTSB is Ireland's third largest bank. The state completed the sell-off of its shareholding in Bank of Ireland in 2022, and in AIB in June this year.
The State still holds a 57.4% stake in PTSB, having invested €4 billion in the lender following the banking collapse.
Today's move by PTSB will test the appetite for Ireland's highly concentrated banking sector, four years after Belgian lender KBC and British bank NatWest quit the market and almost two decades since other foreign banks suffered big losses during the banking crash.
Speaking on the 'Today with Claire Byrne' show on RTÉ Radio 1, Taoiseach Micheál Martin said there's a need for greater competition within the banking system.
"This is good news in terms of the Irish economy," he said.
"This is an indication that people out there want to invest in the Irish economy.
"We're one of the strongest across the European Union, we want to maintain that, and I think it is important in terms of our future that we do get a greater degree of competition and greater investment into the market," he added.
Mortgage book up 4%
News of the commencement of the Formal Sales Process (FSP) came as PTSB issued a trading update this morning.
This showed the bank's total operating income was 4% lower in the first nine months of the year, compared to the same time last year.
However, its deposit book has grown 7%, its mortgage book is up 4% and its business banking book is up 11%.
"Our new mortgage lending year to date is up 64% to €2.1 billion and we expect revenue growth to return in the coming quarters as we benefit from continued loan growth and improved margins," said Eamonn Crowley, Chief Executive of PTSB.
"Operating expenses were marginally lower for the first nine months and are on track to reduce to our full year target of €525 million.
"In addition, our liquidity and capital positions remain strong, with our CET1 ratio at 15.5% at the end of September," he added.
The bank's guidance for 2025 remains unchanged, and it still plans to restart dividend payments to shareholders next year for the first time since the 2008 crisis.
Shares in PTSB are higher in Dublin trade today.
We need your consent to load this rte-player contentWe use rte-player to manage extra content that can set cookies on your device and collect data about your activity. Please review their details and accept them to load the content.Manage Preferences
Sale is about PTSB's long-tern future - Donohoe
Minister for Finance Paschal Donohoe said now was the right time for the sale because it is about PTSB's "long-term" future and about its role in the Irish economy.
He said the prospects for PTSB could be "even better" if it has a "strong owner" that is able to further invest in it, which in turn creates the opportunity for "further competition in the Irish banking sector for the lending and investment which I believe is important to, for example, building more homes".
Minister Donohoe told RTÉ's News at One that the State had now broken even, in recouping all the money it spent bailing out PTSB, AIB, and Bank of Ireland, which was €29.4bn.
"If we decide to conclude this process with Permanent-TSB, it will bring additional money in on top of that."
Mr Dononhoe said it was not for him to comment on any prospective buyer for PTSB, including AIB or Bank of Ireland.
He said he would like there to be as "much interest as possible" and that "more competition and more investment" is one of the things the Government is looking for.
He said he believes PTSB’s branch network is a "competitive advantage of the bank," being "very well regionally distributed" across Ireland and has played a "very important role in the recent success of PTSB".
