It introduced a second layer of security last year, requiring customers to submit a extra code in addition to the usual online passwords when using internet banking.

Some 100 codes are printed on a special card issued to AIB internet banking customers, and they are instructed to use one every time they log on to their accounts. Even if customers disclose their passwords to fraudsters, the information is worthless without the backup code card.

"Since the introduction of two-factor authentication, we have had no reports of customer accounts having been compromised by phishing attacks, " said an AIB spokesman.

Last week, it emerged that Bank of Ireland had refunded 160,000 to nine customers who had been swindled in a phishing scam after disclosing their security details to fraudsters on a bogus version of the bank's website.

Bank of Ireland repaid the money despite the industry's policy of not refunding customers who ignore warnings not to reveal passwords or other personal information.

A spokeswoman said that Bank of Ireland was not planning to introduce AIB-style, back-up security. "We're constantly reviewing security but we've no immediate plans for two-factor authentication, " she said. "We're concentrating on a concerted communications campaign to ensure a high level of awareness of the dangers of phishing."

Irish banks have been criticised in the past for failing to invest more in internet security. Greg McAweeney, general manager of new online bank RaboDirect said that, even when the banks reimburse losses suffered at the hands of online fraudsters, victims are still exposed to identity theft as long as their personal details remain in criminal hands.