Banks have begun offering struggling developers' overseas assets to the few remaining cash-rich developers. One source, who was offered a scheme in Italy, said the banks were initially concentrating on overseas assets in order to avoid media scrutiny.

The banks have been holding talks since October with cash-rich landowners on potential joint ventures on distressed sites that are likely to be repossessed in the coming months.

Banks have been avoiding formal valuations of properties in order to avoid bringing them before their audit committees. It is expected many of the banks will begin paying for valuations in the new year after recapitalisation goes ahead. Sources said they believed the valuations would be largely verbal, again to avoid cases having to go before the audit committees.