Royal Bank 'pondering Allied bid'

ROYAL Bank of Scotland is considering making a bid for scandal-hit Allied Irish Banks, it has been claimed.

According to The Business newspaper, Royal, Britain's second-largest bank, is on the brink of making an approach to Allied Irish, the Irish outfir hurt by £483m in losses from suspected currency fraud at its Allfirst unit in the United States.

A Royal Bank spokesman said on Sunday: 'This is the latest in a long line of rumours. We haven't commented on any in the past. I'm not going to comment on this one.'

Royal Bank has been integrating NatWest, which it bought in 2000, but has already made a fresh acquisition since then, buying the retail arm of Mellon bank in the United States last summer.

There has already been speculation Royal Bank might be ready to do another deal. When the Irish bank's troubles surfaced earlier in February, Royal Bank was tipped as a possible buyer because it also owns Ulster Bank in Northern Ireland.

The Business said Royal Bank's advisers, investment banks UBS Warburg and Merrill Lynch, were studying proposals to offer Allied Irish's shareholders e14.50 a share, which would value the bank at almost e13bn.