UK Financial Investments (UKFI) has hired Jim O’Neil from Bank of America Merrill Lynch to manage the eventual divestment of its stakes in Lloyds Banking Group and Royal Bank of Scotland.

UKFI, which manages Britain’s stakes in its bailed out banks, currently owns 83% of RBS and 41% of Lloyds and also manages the government’s ownership of Northern Rock.

UKFI’s current chief executive, Robin Budenberg, said: “I consider Jim’s appointment to be a real coup for UKFI and for the taxpayer as shareholder in Lloyds and RBS.””