AIB has given details of how its share capital will be restructured in tandem with the partial redemption of some of the preference shares which the State holds in the bank, prior to a planned stock market re-flotation during 2016.

As part of its capital restructuring, AIB will reduce the number of new ordinary shares to approximately 2.7 billion - down from 523.4 billion.

Investors will offer one share for every 250 held by investors. Shareholdings will be rounded up to the nearest ordinary share, so smaller shareholders who own fewer than 250 shares currently will still retail one share and remain on the share register.

The bank announced earlier in this month that it will begin to repay the €21bn it received when it was bailed-out by the State. The Government owns more than 99% of the bank’s ordinary share capital but also holds preference shares in the bank and high yielding loan notes known as contingent capital notes.

In its trading statement, AIB said that it recorded €6.2bn in new lending drawdowns in the nine month period to September, a 53% increase year-on-year.

Non-performing loan balances are down by a further €2bn since the end of June while owner occupier mortgages in arrears are 20% lower since last December.

AIB CEO Bernard Byrne said: "The bank's performance continues to improve, showing further advances in the third quarter. Our customer-focused strategy is enabling us to grow our lending, support the economy and further reduce non-performing loans.

"The key indicators show that AIB is set to continue playing a central role in the rapidly-growing Irish economy. The recent approval by the ECB of our reorganised capital structure is welcome and positions us well to repay capital to the State."