High street lender Clydesdale is to be listed on the London Stock Exchange under plans for the bank to split from its Australian parent company.
Up to 30 per cent of Glasgow-based Clydesdale, which also includes Yorkshire Bank, will be sold to institutional investors before the end of this year.
The remainder will be held by shareholders of National Australia Bank (NAB), the group which has owned Clydesdale since 1987 and Yorkshire since 1990.
The UK business, which has about 7,000 staff and more than 300 branches, has long been the subject of sale speculation after it racked up hefty losses for NAB through property loans turned sour.
Clydesdale Bank was fined a record £20.7 million after it was found that thousands of PPI complaints may have been rejected unfairly.
Discussions with regulators over the proposed split are ongoing, with the UK’s Prudential Regulation Authority demanding that NAB sets aside up to £1.7 billion to cover potential losses from mis-selling and other conduct issues.
Debbie Crosbie, Clydesdale’s acting chief executive, said: “Today’s announcement marks the beginning of an exciting new opportunity for Clydesdale and Yorkshire Banks.
“Our performance is improving and we’re providing real customer choice in the UK which is driving encouraging growth across our target retail and SME markets.”
Half-year results showed the impact of lower bad and doubtful debts and improved economic conditions as pre-tax earnings rose 33 per cent to £118m.
NAB said last autumn that the Clydesdale demerger was an ‘’absolute priority’’ after a 1.1 per cent drop in full-year profits to AUS$5.3bn.