Three new banks (two not so new) to open on high street

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Three new high street banks will be formed as Royal Bank of Scotland and Lloyds Banking Group are broken up.

Each of the two Treasury-controlled banking giants will have assets sold off to increase competition between lenders and recoup money for the taxpayer, following last year's bailouts.

Two of the new banks will be familiar names. Trustee Savings Bank (TSB), taken over by Lloyds in 1995, and Williams & Glyn's, owned by RBS, will return to the high street. The third will be formed from the healthier parts of the nationalised Northern Rock, which is likely to be split into "good" and "bad" banks.

Alistair Darling is expected to present the plans to the Commons this week, although no assets are expected to be sold before the next general election.

No one who currently owns a British retail bank will be allowed to take over the new institutions.