Clydesdale Bank hopes for £2bn price tag despite choppy markets

City sources say the board of National Australia Bank (NAB), owner of the Glasgow-based lender, will meet early this week to decide on the pricing of the London listing.

The valuation range for the shares announced by Clydesdale implied a total valuation for its shareholder’s equity of between £1.54bn and £2.07bn.

The price range equates to a market capitalisation of £1.54 billion-£2.07 billion and implies a multiple of book value of CYBG’s full-year 2015 net tangible assets of 0.56 to 0.76 times.

NAB acquired Clydesdale Bank in 1987 and Yorkshire Bank in 1990.

NAB will complete its long-awaited exit from the United Kingdom a week later following the demerger and IPO.

It is proposed that CYBG shares will be listed on the London Stock Exchange’s main market for listed securities and commence trading on 2 February 2016 on a conditional basis, and CYBG CHESS Depositary Interests will be listed on the Australian Securities Exchange (ASX: CYB) and commence trading on 3 February 2016.

The two largest UK-focused banks, RBS and Lloyds, are down 13pc and 11pc respectively so far this month, while the FTSE 100 is down by nearly 7pc.

“NAB may elect not to proceed with the IPO or to only proceed with a partial IPO, in which case NAB will retain a shareholding in CYBG”, NAB said. The CYBG Group, trading the Clydesdale and Yorkshire banks ahead of their demerger, reported last week it had traded in line with expectations in the three months to December.