The splitting of Anglo Irish Bank into a funding bank and an asset recovery unit could be done by the end of the year, chief executive Mike Aynsley said today.
Mr Aynsley said the plan had brought certainty over Anglo, with a ""clear statement from the Government that it intended to stand behind depositors.
Speaking on RTÉ Radio this afternoon, Mr Aynsley said much of the work had already been started and the bank was hoping to complete it by the end of the year.
"This is not the form of the split that we had talked about previously, but there are many similarities and we've done a lot of work heading towards splitting the bank. There's a lot of work that's already been undertaken," he said.
The bank is going through a revision of the plan that will be submitted to Brussels in the coming weeks, he said.
"We want to get it done as soon as possible," he said. "The end of the year would be our target date at this point."
However, details needed to be worked through and Mr Aynsley said it was not yet known if splitting the bank would require legislation to be passed.
Other aspects, including governance of the bank and how separate its operations, would need to be worked out.
"What we want to do is optimise the underpinning infrastructure of the bank and make sure that the governance is suitable and appropriate for the two separate banks."
Mr Aynsley said there structural issues that need to be addressed in Ireland.
"The reality is that we do have a reliance as a nation on funding from the offshore markets and it's critical that we have mechanisms to get depositors from all parts of the world comfortable that ire is a safe place to put their funds," Mr Aynsley said.
He said he expects to continue his involvement in the banks, but did not know what his role would be once the split was completed.
Earlier today, Mr Aynsely told Bloomberg Television that €25 billion is a "pretty good estimate" of the total bailout cost for the bank.
Credit-default swaps tied to Anglo's subordinated bonds rose today, according to data provider CMA.
Swaps protecting the riskier, subordinated debt of the nationalised lender climbed 43 basis points to 1,780 as of 12.15 pm in London, while contracts on its senior notes fell 13 basis points to 763, CMA prices show. Credit swaps on European government bonds also rose, while contracts linked to the region's corporate debt was little changed.
The yield on Irish bonds fell to 5.829 per cent at 2.57pm, while the spread between the Irish 10-year bond and the benchmark German bund was 345 basis points.
On the Dublin stock market, bank shares continued to suffer with Bank of Ireland falling 4.2 per cent to 68 cent and AIB losing 1.3 per cent to trade at 74 cent by 2.45pm. Irish Life and Permanent was also down, losing 2 per cent to trade at €1.59.
Additional reporting: Bloomberg
