RBS was forced to agree to the sale in return for receiving a state bail-out and had previously agreed for Santander to purchase the units.
However, after numerous set-backs, Santander has now pulled out of the deal, leaving 319 branches up for sale with no confirmed buyer.
Virgin Money took over part of Northern Rock earlier in the year but had previously made an attempt to buy the branches from RBS, but was beaten to the deal by Santander. Now, with the Spanish-owned bank out of the scene, there is a very good chance Virgin will be back with a beefed-up bid.
The deal between RBS and Santander was originally tied up in August 2010, but the final details still had to be hammered out. After the conclusion was delayed twice and a management consultancy estimated the target date of the end of 2012 would be missed, suggesting 2014 as the earliest possible completion, the deal was finally scrapped.
A total of 40 banking centres which provide services for small to medium sized businesses, as well as 316 high street branches, were involved in the deal and are now up for grabs.
Virgin Money is believed to be ‘reconsidering’ its previous bid but rival bidder, NBNK, is also said to be gearing up to try and snatch the RBS package, to build up its high street presence in the UK.
Stephen Hester, the head of RBS, has said that customers will not be affected by the change and that all services will continue without interruption. He added that the bank would immediately launch a campaign to find a new buyer.