Santander, Virgin and NAB to compete for over 300 RBS branches

It remains to be seen, whether they further enlarge or leave the rest of the branches to a sixth network, encompassing NAB's Clydesdale & Yorkshire branches, or a new entrant like Virgin Money.

Sandy Chen, Tesco Bank and Metro Bank - a brainchild of entrepreneur Vernon Hill are other names being mentioned for new lenders, but none appear to be starting off by making acquisitions.

Metro Bank, who has today recruited a crop of senior bankers from RBS and HBOS to join its management team has already two branches almost open in Central London (7 days a week opening hours, plush environments, no secuirity glass) says it has plans to open four more this year and 200 within ten years.

Havung applied for a banking license 18 months ago, Metro is understood to be confident that the FSA is close to giving it its banking license.

As part of its negotiations, Metro apparently agreed for Mr Vernon Hill, who lives in the United States to move from chairman to vice-chairman only.

Tesco Bank is also thought to be close to becoming a reality after it recently sent out letters under the new branding of 'Tesco Bank' to its customers instead of 'Tesco Personal Finance'.

The rebranding is thought to be also a sign that the FSA is close to granting it a license.