Allied Irish Bank, the largest Government-controlled lender, is expected to appoint Fergus Murphy, chief executive at its EBS unit, to head its corporate, institutional and commercial banking division.

Mr Murphy (48) would replace Jerry McCrohan, who is retiring, according to sources, who declined to comment as the process is not public.

Mr McCrohan (62), who reached retirement age in 2010, had agreed to remain with the lender as his role evolved from head of capital banking to include oversight of the corporate, institutional and commercial banking division, which was set up last year.

AIB was ordered by Minister for Finance Michael Noonan to take over EBS, also owned by the State, in July after the Government injected €20.7 billion into the two lenders.

A spokeswoman for the bank declined to comment and said Mr Murphy was not available for comment.

Mr Murphy took over as chief executive office of EBS in January 2008, having previously worked for Rabobank, which he joined in 1993. – (Bloomberg)