CYBG which owns Clydesdale Bank has reached a takeover deal with Virgin Money that values the bank at £1.7 billion but is likely to lead to more than 1,500 job losses.

CYBG's David Duffy will be chief executive, leaving Virgin Money boss Jayne-Anne Gadhia to serve in a consultancy role as his senior adviser.

The group - which will have its HQ in Glasgow - will see CYBG's Jim Pettigrew continue on as chairman alongside finance chief Ian Smith.

The bulk of the cuts will affect senior management positions, as CYBG has said there is "very little in overlap" in customer-facing roles.

The prospect of bank branch closures was played down by CYBG's finance chief Mr Smith, who said it was "early days" for any estimates.

However, he said it was "pretty clear" that Virgin Money's branch network "fills up some spaces that we don't have at the moment".

Both have branches in Southampton.

The new bank will be the sixth largest in the UK.

"The combination of Virgin Money with CYBG will have greater scale to challenge the big banks," said Ms Gadhia.

"It will also accelerate the delivery of our strategic objectives, particularly the expansion of the products we offer to customers."

Sir Richard Branson is expected to rake in royalties for CYBG's use of the Virgin brand - at a minimum fee of £15 million annually after the first four years that the combined group is operating.

CYBG said it will work "collaboratively" with Virgin Enterprises in regards to the rebranding of CYBG's businesses as well as to the ongoing use of the Virgin Money brand.