Financial giant, HSBC Holdings Plc has said that it is considering floating around a third of its British retail and commercial banking arm.

The move to sell up to 30 percent of its British retail and commercial banking arm will allow the banking giant to comply with the new UK rules that require banks to ring-fence their retail arms. According to people closer to the matter, the plan is still in its initial stage and has been discusses with the investors and on the board. There have been informal conversations at board level regarding the plan to float such a stake.

Estimates showed that such a flotation will allow the bank to raise around 20 billion pounds or about $32.7 billion. The bank is considering the IPO ahead of the incoming Vickers rules requiring banks to ring fence their retail arm to protect them from riskier investment arm. Experts have said that it is not required for the banks to completely separate the business but they said that the bigger banks might create separate entities.

Lloyds Banking Group is also planning to float its TSB subsidiary next year and Royal Bank of Scotland is planning to float a new challenger bank under the revived Williams & Glyn's brand in 2015.