IRISH Life is unlikely to be floated on the stock market instead of being sold, as the government works on a solution to get the insurance company out of state hands.
Weekend reports suggested that the government was now looking at an initial public offering for the company within a year instead of selling the group to a trade buyer.
The move follows the successful flotation of Direct Line by RBS in the UK last week.
Direct Line went public last Thursday and its shares immediately rose, raising hopes that the market for insurance companies may be turning.
The state paid Permanent TSB €1.3bn for Irish Life last November after a deal to sell the company to a Canadian firm fell through at the 11th hour as the euro crisis worsened.
Since then the immediate future of the euro has become less of a concern and international markets have been relatively calm, raising hopes that Irish Life could leave state ownership sooner rather than later.
Yesterday, however, industry sources said the market for an Irish insurance business was still not conducive to a sale.
While shares in Direct Line have increased in value since they went on the market, the shares were 'priced to sell' and RBS raised about €2.6bn on the sale -- less than had been hoped.
In September, German insurer Talanx pulled a €1.3bn flotation because "investor feedback on the company's valuation deviated significantly from the estimated minimum fair value" of the company.
A spokesman for Irish Life declined to comment on the matter, while the Department of Finance said it would not comment on "speculation".
Unlike Direct Line, most of the prospective trade buyers for Irish Life are based in North America, where a much more alarmist view of the European problem has taken hold.
Speaking last month, Irish Life chief executive Kevin Murphy said it would take several months of calm markets for a sale of Irish Life to become feasible again.
The company had ruled out any hopes of a sale in the short term and market watchers expect it to be 2014 at the earliest before the pensions giant returns to private control.
Deutsche Bank are favourites to lead any sale process when it happens, having advised on the failed process last year.
But there have been no moves to appoint new advisers, and there is no sense that the deal could be revived before the end of 2013.