Strong growth in lending and venture capital activity at ICC Bank has pushed profits up 64 per cent to €23.2 million (£18.3 million) in the six months to the end of April.

Announcing the results yesterday, ICC chairman, Mr Phil Flynn, said the bank expected to continue the positive trend with a strong full-year outturn.

The state-ownes bank, which specialises in the small and medium business sector, is being prepared for sale and has submitted a business plan to the Minister for Finance. ICC Bank's chief executive, Mr Michael Quinn, said the plan was growth-based and focused on developing its activities in the business lending and venture capital sectors.

"The plan signals significant profit growth for ICC which is our focus. Discussions with the Department of Finance going forward will examine the options for a change in ownership but driving the business forward is our immediate focus. "The board and management is looking to build the business and make sure it is giving a good return to shareholders and looks attractive to any future owner," he said.

Mr Quinn would not speculate on a timeframe within which the ownership issue may be resolved. The bank is seeking a strategic partner, or alternatively, the Government may sell it. The current uncertainty on the future ownership does not affect ICC's ability to fund its lending to the business sector. But Mr Quinn said over time the bank would like to have scope for "quantum leaps" in its capital base.

The sharp increase in income generated at ICC Bank was the main factor in the substantial decline in its cost-to-income ratio over the six months from 47.1 per cent to 35.8 per cent. Mr Quinn said the bank had been working to achieve greater efficiency from its existing cost base and that income had risen much faster than cost reduction.

A potential buyer will view positively the scale of the reduction in this ratio and it will be important for the bank to be able to maintain these levels over the rest of the financial year.

Its core lending business was up 24 per cent in the six-month period to €2.5 billion with the bank reporting strong demand for funds in the tourism, transport and communications sectors.

The bank has also increased its presence in the service industries sector and has also been active in funding projects in the renewable energy sources area.

ICC's venture capital division also performed well, completing its €127 million Private Equity Fund. To date some €51 million of this fund has been committed to investments.

It also established the Software 2000 fund which aims to raise a further €127 million for investment in that sector. In the six months to the end of April it has invested €34.2 million in 16 companies compared with €17.5 million in the same period last year.