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LONDON (Reuters) - Royal Bank of Scotland (RBS.L) has hired Bank of America Merrill Lynch (BAC.N) to prepare a spin-off of its Williams & Glyn-branded retail branches in the second half of 2016, a spokeswoman said on Sunday.
The Sunday Telegraph reported, without citing sources, that RBS hoped to value the bank at 1.5 billion pounds ($2.31 billion) and that investment bankers would start meeting investors later this year to discuss the planned float.
RBS was ordered to sell Williams & Glyn, which comprises 314 branches and is focused on lending to small businesses, by European regulators as a condition of its 46 billion pound government bailout during the 2007-09 financial crisis.
It will be a separately licensed bank with about 1.4 million retail customers and more than 200,000 SME customers.
Williams & Glyn must be sold by the end of 2017 but the sale process has been costly and dogged by setbacks, largely related to technology problems. In 2013 RBS sold a 49 percent stake to a consortium of investors led by U.S. private equity firm Corsair.
Reporting by Kylie MacLellan and Steve Slater; editing by Jason Neely