Barclays in the running to buy AIB

BARCLAYS has signalled its interest in taking over Allied Irish Banks, reeling from the £500 million rogue-trading scandal. A senior executive said that Barclays would consider a deal 'if we received the right phone call, on the right terms'.

Matt Barrett, Barclays' Irish-born chief executive, wants to expand into the eurozone, of which Ireland is a member, and lift non-UK earnings from 20% of the annual total to 50% by 2010.

He could easily afford an offer. Barclays made £3.6bn profits last year - half the entire value of AIB.

AIB chief executive Michael Buckley is fighting to rebuild his tattered reputation after the scandal of US trader John Rusnak.

A report last week revealed how Rusnak used fake currency trades to blow a £485 million hole in AIB's American subsidiary, Allfirst.

Buckley kept his job, despite the report laying blame all the way to the top. Six senior treasury staff at Allfirst were fired.

His survival has led some analysts to speculate that he was being kept on board to lead AIB through a takeover.

If Barclays tables an offer, it may be in hot competition with Royal Bank of Scotland and Bank of Ireland, which both want to talk to AIB.

The Barclays executive stressed that no formal talks were taking place.

'Nothing is on, and nothing is off,' he said.