Metro Bank Holdings PLC (LSE:MTRO) is in talks to offload a £3 billion mortgage portfolio to Barclays PLC (LSE:BARC) as part of a broader financial restructuring aimed at saving the smaller high street lender from collapse. Sky News has learnt that Metro Bank has entered exclusive talks with Barclays to sell the residential mortgage book in a move that would strengthen its capital position. News of the negotiations comes just hours before Metro Bank is expected to announce that its shareholders have overwhelmingly backed a £925m refinancing plan.

The recapitalisation, which has already won approval from bondholders, was announced last month following a weekend of intense talks about a rescue deal. The £925 million package will see the Colombian billionaire Jaime Gilinski Bacal becoming its majority shareholder. A deal is likely to be struck by the end of the year.

Barclays and Metro Bank both declined to comment.