The UK government is considering plans to invest a further £1.5bn into Royal Bank of Scotland if a review it commissioned recommends the state-backed lender be split into a ‘good bank’ and ‘bad bank’, The Telegraph reported.

The Co-operative Bank has left renewable energy developers in the lurch after freezing a £1.0bn funding pledge, The Times revealed. The British bank has cancelled new loans, leaving developers to secure new backing instead from mostly blue-chip European banks.

Lloyds Banking Group’s chief executive António Horta-Osório has said he aims to start paying out up to 70 per cent of the bank’s earnings in dividends within three years, the Financial Times unveiled. The dividend target, which is significantly higher than the proportion of earnings paid out by the bank’s UK peers, comes as Horta-Osório tries to attract investors ahead of the sale of the government’s stake.

New figures have revealed more than 1m British workers could be employed on zero-hours contracts, The Guardian said.

The International Monetary Fund has forecast that Britain will have grown by just 1.2 per cent at the end of the Coalition’s term in 2015, The Independent reported.

Campaigners have called for millions of rejected payment protection insurance compensation claims to be reopened after new research showed that banks had saved more than £4.0bn in payouts, according to The Times.

The Royal Mail faces a strike by thousands of postal workers after a disagreement with management deepened, The Mirror said.