ABBEY National is looking into further co-operation and initiatives with the Irish Permanent, in which it has a 10 per cent share holding.
Britain's fourth largest bank bought the interest after the Irish Permanent was floated two years ago. Abbey's chief executive, Mr Peter Birch, said he had no plans at present to increase the stake. But he stressed he enjoyed a "good business relationship" with the Permanent's directors.
Speaking after the formal introduction of Scottish Mutual International, which is owned by Abbey National, Mr Birch said Irish Permanent had been "invaluable" in setting up the offshore company.
He added that the two banks are close to linking their automated machines in Britain and Ireland.
Mr Peter Fitzpatrick, financed director at Irish Permanent, said the banks were "quietly developing synergy" in life insurance as well as mortgages. Although no firm plans have yet been drawn up, Mr Fitzpatrick did not rule out joint product development.
Scottish Mutual International plans to employ 100 people in the Financial Services Centre within five years and to attract £900 million in funds under management.
After a shaky beginning, which saw its managing director, Mr Bob Gibson, resign just weeks before the launch at the beginning of the month, the company has taken in £1 million from British investors.
