Bank of Ireland has become the latest listed company to discontinue scrip dividends - the system where shareholders can opt to take new shares instead of cash.

This follows a similar move last September by Allied Irish Banks, and is likely to lead to more firms abandoning scrip dividends, say market sources.

Bank of Ireland head of investor relations, Ms Mary King, said scrip dividends had been discontinued for several reasons, particularly stock market volatility and that scrip dividends were now treated the same way as cash by the Revenue.