LONDON (AP) _ Alliance & Leicester PLC and Bank of Ireland Group confirmed Monday that they are discussing a merger.

The combined group would be the eighth largest bank in Britain and the fifth largest mortgage provider, and No. 1 in Ireland with assets of $103 billion.

Based on 1998 results, two companies had profits before exceptional items of $1.6 billion.

The companies said they are discussing dual-listed company structure, with Alliance & Leicester and Bank of Ireland shareholders retaining their existing holdings in the respective companies.

The banks estimate the merger would create pretax cost savings of more than $320 million.