Speaking to the Irish Independent, the financial institution's chief executive Kevin Murphy said IL&P was open to the idea of discussions with Cardinal, which has emerged as the favoured bidder for rival building society EBS.
Previous speculation had suggested that IL&P was seeking to buy EBS itself and merge it with its troubled Permanent TSB arm, but Cardinal has since moved into pole position and Mr Murphy claimed a "range of possibilities" were on the table.
"If Cardinal gets EBS and if they are interested in talking to us, we'd certainly be interested in talking to them," he commented. "It remains our strategic view that smaller banks need to merge to create stronger entities."
His comments came as the Irish Central Bank revealed that the country's financial firms owed bondholders more than â¬63 billion ($87.2 billion)
By Claire Archer