Bank of Ireland has confirmed the sale fund administration unit Bank of Ireland Securities Services to US-based Northern Trust in a deal that could be worth up to €60 million.

The sale is subject to regulatory clearance and will generate about €40 million in equity tier 1 capital for the bank.

Northern Trust said the deal is expected to be completed in the second quarter of the year.

Bank of Ireland Securities Services provides specialised services to a range of funds, including mutual money-market, multi-manager, exchange-traded funds and property funds.

"This acquisition will enhance and expand Northern Trust's Global Fund Service capabilities, particularly in the key areas of fund administration and the support of ETFs," said Steven Fradkin, president of corporate and institutional services at Northern Trust.

Northern Trust has offices in both Dublin and Limerick, and has been operating in Ireland since 2000, when it acquired Ulster Bank Investment Services. It currently employs about 570 people.

"Ireland is one of the largest European domiciles for cross-border fund administration," said Northern Trust chief executive Frederick Waddell. "We look forward to combining this business with our existing activities in Ireland."

Bank of Ireland is currently trying to raise €2.2 billion core tier 1 capital by the end of this month, as required by the Central Bank as part of Ireland's bailout by the European Union and International Monetary Fund.

Additional reporting: Bloomberg