Europe's biggest standalone investment firm Schroders said it was in talks with Britain's biggest bank Lloyds to work together in the wealth sector.

This could potentially mark one of the biggest wealth management tie-ups in recent years. 

Asset manager Schroders said in a short statement that discussions were ongoing and there was no certainty that they would lead to a deal. 

Lloyds issued a similar statement on Sunday, saying any further announcement "will be made at the appropriate time." 

Weekened reports said that Lloyds would merge its £13 billion wealth management arm into a new joint venture with Schroders. 

A deal, if struck, would come amid widespread consolidation in the broader industry sector. 

A tie-up would also give Lloyds access to the asset manager's investment management experience, while Schroders could rack up a lot more customers.

Wealth management contributed £273.3m to Schroders' net income in 2017 and has been an area of focus for future growth. 

The potential deal, part of a three-pronged tie-up between the companies, would see Lloyds owning 50.1%‎ of the joint venture, with Schroders owning the rest, Sky News said, citing sources. 

The deal would include Schroders taking on a £109 billion investment management contract from Lloyds-owned Scottish Widows that is the subject of a disagreement with Standard Life Aberdeen, which previously managed the money.