Yorkshire Building Society has revealed that it is in discussions with Norwich and Peterborough Building Society (N&P) over a possible merger.

The mutual said on Friday evening that the discussions were subject to completion of full and satisfactory due diligence, which will take a number of weeks to complete, and the satisfaction of certain pre-conditions.

The Yorkshire is currently the UK’s second largest building society with approximately 2.6 million members, 178 branches and assets of over £30 billion. It merged last year with the Chelsea Building Society.

It is widely believed that Kent Reliance and JC Flowers, who recently formed One Savings plc, have been looking at a possible take-over of N&P.