AIB is set to close up to 90 branches, mostly in rural areas, in a radical overhaul of the organization to drive down costs.

The restructuring will see the state-controlled bank teaming up with AN Post, which will deliver traditional banking services to the customers in areas most affected by the branch closures, reports the Irish Examiner.

"AIB and An Post have now agreed to work together to extend the banking services available to customers in selected post offices ... Our distribution network will be enhanced by the new An Post initiative and it will support us in making changes to our current branch footprint," said an AIB spokesperson.

"Regrettably, this means that the number of branches will reduce as part of the move to lower costs. But through the use of mobile banks and new branch openings in selected areas, AIB will bring banking services to new locations."

The spokesperson would not comment on how many branches will be affected and said a date has not been set for the completion of the review.

For the past decade, AIB has been offering cash lodgement, withdrawal, and credit card bill-paying services through 1,100 An Post outlets. These services will not be expanded to include cheque lodgements and deposit account transactions.

"In locations where branches are to close, AIB’s closer ties with An Post will ensure that a wider range of ‘over the counter’ banking services are available to customers," said the spokesperson.

Under the new strategy, the bank plans that nearly all traditional retail banking services will be done online with branches used for more complex advisory business banking services.

Employees working in branches that will be closed will have the opportunity to relocate to another branch.

Allied Irish Bank HQ, Dublin