The Sunday Times reported that the high street lender, of which Sir Richard Branson’s Virgin Group owns 47 per cent, is tipped to be valued between £1.5bn and £2bn.

Bank of America Merrill Lynch and Goldman Sachs are expected to be appointed to manage the preparations for a listing next year.

Virgin Money is one of several lenders which has announced its decision to float.

At the start of the month Lloyds Banking Group said it intended to float around a quarter of its TSB banking brand in June.

And in December One Savings Bank announced it planned to list in 2014 with Metro Bank looking to float in 2016.

Aldermore has also stated it intends to the float at some point in the future.