SHARES in Royal Bank of Scotland soared yesterday as investors welcomed reports of a "radical" restructuring drive to sell off unwanted assets - despite fears that the move could lead to 20,000 job losses.

The part-nationalised bank saw its shares rise by as much as 18% as investors await details of the plans, which are understood to involve splitting its traditional functions from several hundred billion pounds of unwanted assets.

Reports of the asset sell-off has sparked speculation that many more roles could be cut as the bank moves to dismantle the empire assembled by the group's former boss, Sir Fred Goodwin.

The aim of the scheme is to isolate the troubled areas of the business - thought to be around £300 billion of assets - into a "bad bank" and allow the stock market to place a value on the remaining core operations.

Chief executive Stephen Hester is not expected to place a figure on the number of subsequent job losses, but reports at the weekend said as many as 20,000 jobs could go, equivalent to around 10% of the global workforce. RBS has already announced more than 2,000 job cuts this year.

The bank, which is 68% owned by the taxpayer, is expected to announce Britain's biggest corporate loss of up to £28 billion on Thursday and cost cuts worth around £1 billion a year.

But banking shares rose across the board yesterday on investor expectation that the week's financial news has the potential to mark a "turning point".

Howard Wheeldon, of BGC Partners, said: "Just possibly, events that will unfold in the UK this week could actually signal a small but nevertheless important sentiment reversal for our banks."

Investors were also buoyed by news that nationalised bank Northern Rockwould lend up to £14 billion extra in new mortgages.