National Irish Bank (NIB) is set to become the latest Irish lender to ann­ounce job cuts.

NIB, owned by Danske in Copenhagen, is understood to be preparing an imminent announcement involving job losses among its 634 staff and the closure of a significant number of its 58 branches.

Northern Bank in Belfast - Danske's other big Irish acquisition – may escape the job losses.

A spokeswoman for NIB denied there were any plans to announce job losses or bank closures.

Peter Straarup's Danske completed the €1.4bn purchase of NIB and Northern in March 2005 from National Australia Bank. The cost of investing in technology to link the Dublin and Belfast banks into Copenhagen lifted the total acquisition bill to €1.6bn.

Danske went ahead with its Irish purchases after NAB covered it for the costs of printing new bank notes following the £26.5m heist of Northern Bank's central Belfast head offices in December 2004.

Last week, Permanent TSB said it planned to shed up to 120 banking jobs and close 11 branches and AIB's new managing director Colm Doherty warned staff of the need to cut costs.

Last summer Larry Broderick, general secretary of the Irish Bank Officials Association, which represents 23,000 banking employees, warned that Irish banks were preparing to contract through a wave "of mergers, acquisitions or closures".

From the start, NIB competed aggressively with AIB, Bank of Ireland and Permanent TSB in the residential loans market. It won a slice of the switcher market offering tracker mortgages as low as 0.49% above the European Central Bank rate – making them the cheapest home loans in Europe.

NIB's contraction will lessen competition in many Irish towns and further strengthen AIB and Bank of Ireland's dominance of Irish banking.

In the past year, NIB was the first and least reticent lender here to acknowledge the true dire picture of Irish commercial lending and write off the losses. Its honesty upset other banks here who continued for some time to deny their escalating commercial loan losses.