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Royal Bank of Scotland is closing in on a deal with the European Commission which will see it hive off 312 English and Welsh branches under the RBS fascia to pass Europe's state aid rules.
Talks between the Treasury, which owns 70% of RBS, and Europe's competition commissioner Neelie Kroes are said to be close to a solution, although she could demand more disposals.
RBS would rebrand the 312 branches under the old Williams & Glyn name which disappeared from the High Street a quarter of a century ago. It may also throw in the handful of branches in Scotland which trade under the NatWest brand.
The branches which would be sold off or even floated separately on the stock market are primarily focused on servicing small and medium-sized businesses and expatriate Scots.
Kroes wants RBS to cut its share of the small business market by around 10%. It currently has 30% of the market.
Chancellor Alistair Darling has been involved in the talks with Kroes and is hopeful of a resolution early in November, even though the competition commissioner retires at the end of this month.
But Darling is also keen to ensure that any sell-off of RBS assets does not do further damage to the value of the taxpayers' 70% stake.
That is currently worth £1.4 billion less than the Government paid for it.
However, the taxpayers' losses on their 43% stake in Lloyds Banking Group is even greater at £3.9 billion.
The Government could get some of that shortfall back if it can get Lloyds to pay a £1 billion plus break fee for bailing out of the asset protection scheme under which the Treasury insures against losses on some of its worst debts.
That is said to be the minimum price the European Commission expects Lloyds to pay for providing it with support over the last seven months.
