NBNK suspends shares over talks to buy Clydesdale and Yorkshire

Lord Levene's NBNK takeover vehicle took a step closer to its debut in the UK banking market today after confirming acquisition talks and suspending shares.

The Lloyd's of London chairman raised £50 million from investors last year to take the plunge into the retail banking market and hired former Northern Rock chief executive Gary Hoffman to run the business.

It has an estimated warchest of around £8 billion to fund deals.

NBNK is said to be in talks with the National Australia Bank over the Yorkshire and Clydesdale banks ahead of a bid for the 632 branches which are being sold by Lloyds Banking Group to assuage European competition concerns.

The Lloyds branches alone account for more than 5% of the British retail banking market, and if Levene manages to pull off both deals he will create a major new UK player with just under 1,000 branches.

Lloyds is assessing bidders for its branches ahead of a September 30 deadline for second-round bids. Completing a deal with Yorkshire and Clydesdale banks could make NBNK more attractive to Lloyds as a potential buyer because it would already have access to an operational banking platform.

NBNK said any deal would be structured as a reverse takeover, requiring the suspension of its shares.

It is barred from a bid for Northern Rock until at least November under the terms of Hoffman's departure from the nationalised lender.