The government has created a company, called UK Financial Investments (UKFI), which will act to protect the taxpayers' investment in banks, promoting stability and competition.

It will also look to ensure bank management incentives reward the creation of long-term value and not for failure.

Its board will contain a private sector chair, three non-executive private sector members, a chief executive and two senior government officials from HM Treasury and the Shareholder Executive.

Sainsbury's chairman Sir Philip Hampton will be its first chair, and John Kingman its chief executive.

Sir Philip is a former FD at some of the biggest companies in the country, including LloydsTSB and BT among others.

John Kingman is second permanent secretary and managing director, public services & growth, HM Treasury.