Irish Life says Ulster Bank tie-up an option

DUBLIN, March 3 (Reuters) - Bancassurer Irish Life & Permanent (IPM.I) sees Royal Bank of Scotland's (RBS.L) Ulster Bank unit as a potential partner for its banking unit in an expected industry consolidation wave, a senior executive said. Group Finance Director David McCarthy said nationalised Anglo Irish Bank and building societies EBS and Irish Nationwide were other possible partners for Irish Life & Permanent's banking unit permanent tsb if consolidation happens.

"We've had no definitive discussions with anybody with regard to the formation of that 'third force'," McCarthy told Reuters, referring to the term widely used for the potential new rival to top banks Allied Irish Banks (ALBK.I) and Bank of Ireland (BKIR.I). Earlier on Wednesday, Irish Life reported an operating loss for 2009, weighed down by bad debt provisions in the banking unit.

"We do expect that 2009 would be the worst of the provisioning in our portfolio," McCarthy said.

(Reporting by Andras Gergely, editing by Barbara Lewis)