The financial commentator Sandy Chen is to bid for assets put up for sale by Lloyds Banking Group and Royal Bank of Scotland in a move to expand his new banking business.

One of Britain’s best-known analysts and a regular commentator on the financial crisis, Chen applied for a banking licence in September to create an institution which would focus on lending to small and medium-sized businesses (SMEs).

It is thought that Chen, who works at broker Panmure Gordon in London, would delay a bid for the banks’ assets until around 2012, to allow time for his new business venture to become firmly established.

A ruling last week by the European commission stated that RBS will have to sell 318 of its branches, while Lloyds will have to dispose of more than 600 branches over the next four years to allay fears over competition in the sector.

It is the banks’ small business operations which are most likely to interest Chen, who is to aim his banking venture at small companies which have struggled to secure funding in the credit crunch.

RBS is set to dispose of its 230,000-strong direct SME customer base through the sale of its retail branches, a 5% market share which could prove attractive to Chen.

A spokesman for Lloyds Banking Group told The Sunday Times that discussions were under way on how many of Lloyds TSB Scotland’s branch-based SME customers will be part of the sell-off deal.

Chen’s new bank, which he is hoping will raise more than £100m through an Aim listing, will focus on “traditional” banking methods by attracting mainly large deposits from its customers, which it will use to cover its lending.

In a clear contradiction of earlier reports, Sir Peter Burt, the former Bank of Scotland chief executive told The Sunday Times that he would not be involved in Chen’s new business, despite having been tipped as a likely chairman for the bank.

He said: “Sandy and I had a chat, but where I think there is a need in banking and where he thinks there is a need are in different places.”

Burt added that he believed a sale of the RBS assets would not happen quickly.

He said: “If I was Stephen Hester, I wouldn’t be in a rush to sell them off just now. I think that it will take time before anyone does anything. However, I wouldn’t be surprised if there was interest in the Lloyds TSB Scotland brand fairly quickly.”

A source close to Chen said that he would make a bid for the assets “in the fullness of time”.

He added: “The bank should be in a fairly good position in three years’ time or so, to make an acquisition like that.”

Chen refused to comment.

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