Citigroup is believed to be in talks to acquire a second final-salary pension scheme two weeks after a ground-breaking deal in which it became the first bank in Britain to buy a company retirement fund.

The bank is understood to be looking at a European scheme worth about £200 million, although completion of the deal is not imminent. Sources said that the bank had the resources to make an acquisition worth more than £1 billion if required and had a number of other potential targets lined up. Citigroup refused to comment.

Sources said that the bank had been inundated with calls from companies keen to offload their final salary pension schemes, after it emerged that Citigroup paid a nominal sum for a shell company containing the £200 million Thomson Regional Newspapers fund.

The bank hopes that, through clever investment of the scheme’s assets, it can create a surplus in the fund, which it will access when the scheme is wound up.

The deal was done by Citigroup’s insurance and pensions structure solutions group, part of the bank’s fixed-income business, which was set up just over a year ago. The talks with Thomson took eight months to complete.

It is the first time that a UK company has got rid of its pensions liability without purchasing an expensive bulk annuity from an insurance company.

Andrew Reid, head of corporate consulting at Watson Wyatt, the actuarial consultancy, said that he expected clients to be keen to discuss a similar arrangement. “Depending on the price and the security of members’ benefits, it sounds like a good deal,” he said.

Mr Reid said that improving longevity and greater powers for pensions trustees had made final salary schemes increasingly onerous for employers. “Pensions take up a lot of management time so if you can buy it out, why not?” he said.

Citigroup will take the liability of the Thomson pension scheme on to its own balance sheet, with the scheme continuing to be cared for by its existing trustees, an independent trustee from Law Debenture and a representative of the bank.

Francis Fernandes, head of pensions actuarial, said: “In terms of Citi’s commitment to the scheme members and the pension trustees, benefit security has always been priority 1, 2 and 3 on our list. Anything else is a bonus.” This is different from the purchase of a bulk annuity from an insurance company, which requires a scheme to be wound up so individual retirement benefits can be bought for members.

As a result, Citigroup is likely to be able to offer companies an opportunity to offload their pension schemes more cheaply than if they bought a bulk annuity.

The bulk annuity business has become highly competitive in recent years. Traditional players such as Prudential and Legal & General have been challenged by insurance start-ups including Paternoster and Pension Insurance Corporation, and other insurers such as Aegon. Since opening, Paternoster has bought pension funds worth £335 million.

The Pensions Regulator is believed to have held a number of meetings with Citigroup before giving clearance to the transaction.

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