DUBLIN (Reuters) - Ireland's Allied Irish Banks (AIB) (ALBK.I: Quote, Profile, Research) and Britain's biggest insurer, Aviva (AV.L: Quote, Profile, Research), announced a bancassurance joint venture on Tuesday that they said would lead to new growth opportunities in the Irish market.

The agreement brings together Aviva's Irish subsidiary Hibernian Life & Pensions Ltd -- the third largest firm in the Irish long-term savings market -- and AIB's Ark Life Assurance Company, the fourth largest.

Hibernian will own 75 percent of the new combined operation, which will employ around 800 staff and put together and distribute life and pensions products in Ireland. AIB will own the rest, the two companies said in a statement.

"The advantage of this deal is that it combines the distribution power of the bank (AIB) with the expertise of the leading worldwide bancassurer (Aviva)," Philip Scott, executive director of Aviva Life International, told Reuters.

AIB, Ireland's biggest company by market capitalisation, distributes its products through a branch network of 280 outlets, serving around 1.6 million retail customers.

Scott said the combined organisation would have a market share of around 19 percent, compared with Bank of Ireland (BKIR.I: Quote, Profile, Research) at 24 percent and Irish Life (IPM.I: Quote, Profile, Research) at 25 percent.

Shares in AIB were 0.06 percent lower at 17.65 euros in Dublin by 10:45 a.m. British time, while Aviva stock was up 0.2 percent at 7.04 pounds sterling in London.

The companies said the pro-forma estimated value of the new combined operation would have been 1.33 billion euros at end-December 2004, with sales on an annual premium equivalent basis (APE) of 226 million.

This is cache, read story here