RBS online project

Royal Bank of Scotland could launch an online bank as it targets the valuable youth market and tries to escape its toxic past.

The internet lender would likely be separate from the bank’s existing brands, similar to HSBC’s First Direct.

The potential project comes as big banks try to protect themselves as aggressive start-ups such as Revolut, Monzo and atom attempt to steal away customers.

Virgin Money has already unveiled plans to launch an online bank in response.

RBS last year made its first profit since its £46bn taxpayers’ bailout a decade ago.