British Chancellor George Osborne is set to face calls to split Royal Bank of Scotland, with one idea reportedly suggesting the transfer of its Ulster Bank division to the Irish Government.
A draft copy of a report from Britain's Parliamentary Commission on Banking Standards has recommended breaking up the taxpayer-backed lender, according to reports.
The BBC reported that one idea raised as part of this was to "transfer Ulster Bank into the arms and ownership of the Irish Government".
This would be done by swapping all or part of the bank for the British loans and investments currently owned by the National Asset Management Agency.
The BBC said that senior financial sources in Dublin have said that such a move was ''highly unlikely''.
It is understood the draft version of the highly-anticipated report from the commission was sent to its members in the last week and they have until Monday to read it through, with a final report due by the end of the month.
The recommendation to split RBS would be awkward for Mr Osborne, given the pressure to start recouping taxpayer cash in the part-nationalised banks before the 2015 election.
It is thought Mr Osborne and Prime Minister David Cameron are not keen on a break-up of RBS, which could delay returning it to the private sector and may be seen as a second state bailout of the banking giant.
RBS itself has claimed it is well on the road to recovery, despite reporting losses of £5.2 billion sterling for 2012, driven by a £390m settlement for rate-fixing and £1.1 billion provision for mis-selling and IT glitches.
Philip Hampton, chairman of the 81% state-owned bank, said on presenting full-year results that the institution's recovery would be "substantially complete" by the middle of 2014, paving the way for its return to the private sector.
But outgoing Bank of England governor Mervyn King has also said he believed RBS should be broken up in an attack on the handling of the bank's future in a parliamentary hearing in March.
It is believed the commission has been strongly influenced by Mr King's views and sees a break-up as a way of freeing the bank from residual bad debts, which could help it to lend more to businesses and boost the economy.
The move is also said to be favoured by the commission as a way of increasing potential investor confidence in the 'good' part of the bank and increasing the chance of a successful reprivatisation.
The so-called 'bad' bank would be held on to by the Government, avoiding the need for a fire sale of the more toxic assets and allowing them to recover in value.
The commission's recommendation could potentially be watered down by the time of its final report, but if not, the Chancellor would face a difficult dilemma.
There has also been mounting speculation over the UK government's plans for Lloyds Banking Group after shares have recently risen above the 61.2 pence level at which the government said it would break even on its 2008 bailout.
