An Post and Dutch/Belgian financial services company Fortis have signed a memorandum of understanding for a new banking joint venture which is likely to operate from early 2007.
A final agreement is expected to be signed by this summer. The two companies have refused to say what products they will be offering, but Fortis is believed to be taking responsibility for the design of the products.
The new venture will pay particular attention to people with no current banking relationship.
"Both parties expect to sign the final agreement by this summer. No further comment on the negotiation process will be made," said a statement.
Using An Post's network will immediately make the new venture a significant player in the financial services industry. An Post manages a network of 1,450 post offices employing 4000 people.
Fortis is company mainly engaged in banking and insurance. It offers personal, business and institutional customers a package of products and services through its own outlets and through broker networks.
It has a market capitalisation of €37.3 billion, putting it in the twenty largest financial institutions in Europe.
Its market capitalisation makes it much bigger than either AIB or Bank of Ireland.
Donal Curtin, An Post chief executive, said back in February: "An Post has a unique role in providing a broad range of services to Irish people of all ages and backgrounds. We expect to continue this proud tradition through the provision a suite of financial products that will be relevant and accessible to all customers including the significant portion of Irish consumers who are currently unbanked."
An Post is hoping the new arrangement also appeals internally to staff. Mr Curtin said in February that the venture could help grow the income of postmistress and postmasters.
The idea of An Post banking venture was a key element of the strategic recovery plan for An Post announced by Mr Curtin in September 2003.
Detailed preparatory work was undertaken over the following 18 months which resulted in the appointment in early 2005 of independent consultants to assist in selecting a preferred banking partner.
