Royal Bank of Scotland will decide this week whether to launch a counter bid for National Westminster Bank according to the Financial Times.
The bank is said to be considering a move against rival Bank of Scotland who made a £22bn hostile bid for NatWest last week.
The FT says RBS had previously held discussions with its Scottish rival about a possible joint bid but talks fell through.
RBS chief executive George Mathewson is said to be holding talks with advisers from Merrill Lynch and Goldman Sachs. He is expected to ride to NatWest’ side as a White Knight seeking a friendly union.