The European Commission has approved a restructuring plan which is aimed at ensuring the long-term viability of PTSB.

It ruled today that restructuring aid granted by the Government to the bank did not breech Europe's state aid rules. It received €2.7bn from the State in 2011, it now owns 99.2 percent of the bank.

The restructuring plan hopes to make PTSB a smaller, domestically-focused lender by the end of 2018. It has committed to raising net interest margins - and the selling of low-yielding assets.

At this week's AGM shareholders were told that the bank hopes to raise €525m from private investors.

The European Commission says that it believes that the bank's plan can make it a viable operator, and that it will not be dependent on future state assistance while "ensuring that the bank and its owners contribute to the cost of restructuring and limiting the distortions of competition created by the aid."

Margrethe Vestager, the Commissioner in charge of competition policy, said that the progress of PTSB showed that EU rules have allowed "the Commission and Irish authorities to work together successfully to strengthen confidence in the Irish banking sector in order to return it to normality."

Permanent TSB ended 2014 with a profit before exceptional items of €5m from its core Irish business - and an overall pre-tax loss of €48m. This was an improvement on a €668m loss in 2013.