TAXPAYER owned Northern Rock today announced the appointment of Deutsche Bank to prepare it for a return to the private sector.

The appointment follows a tender process instigated in January by UK Financial Investments (UKFI), the body charged with overseeing the Government's banking assets

It came just 24 hours after Northern Rock's executive chairman Ron Sandler stressed that no timetable had been set to return the bank to private ownership.

The appointment of the German investment bank is likely to lead to speculation a sale, or some other outcome such as a stock market flotation, is likely to take place sooner rather than later.

However Mr Sandler, speaking yesterday as Northern Rock's first full year of trading results were announced, said that even when advisers were appointed there was "no presumption" that any particular option would be pursued.

On Wednesday "good bank" Northern Rock, which was split off from the original institution alongside "bad bank" NRAM in January last year, announced losses in its first full year of £232.4m.

Mr Sandler stressed he did not believe it necessary for Northern Rock to be profitable before it was sold, although it should be moving in that direction.