The Sunday Times reported interest in a bid from City executives after Santander’s bid for Royal Bank of Scotland’s 316 branches fell apart last October.

Santander chief executive Ana Botin refused to answer questions on the bid, suggesting the bank continued to focus on organic growth.

Santander UK is Britain’s fifth-biggest bank after it bought the Bradford & Bingley, Abbey and Alliance & Leicester brands.

Yorkshire and Clydesdale Banks are undergoing a deep restructuring exercise which will lead to the loss of 1,400 jobs by 2015 and parent, National Australia Bank has widely acknowledged its desperation to offload the two banks.