Royal Bank of Scotland has hired Lazard to sell parts of its investment banking business, just weeks after the UK government said it would push for the 83% state-owned bank to be restructured as a retail bank, a person familiar with the situation told Dow Jones Newswires on Wednesday.

RBS has already more than halved its Global Banking and Markets investment banking arm balance sheet to £399bn from £874bn at the end of 2007 and was expected to cut it further to £200bn.