The result of the review is due in May, and it is still classified within NAB as an operational review with a focus on raising the returns from the business that is a drag on NAB's earnings, they said.
NAB's UK bank business spans 335 branches through its Yorkshire and Clydesdale branches. It also holds about £6bn ($9.4 billion) in commercial real estate exposure, with close to a tenth of that stressed, the sources said.
Analysts estimate NAB UK assets to have a book value of around £3 to £3.5bn ($4.7-$5.5bn) and a sale could raise anywhere between 0.5 to 0.7 times book in current market conditions, or between $2.3bn and $3.9bn.
The sources said the core portfolio had the likelihood of fetching closer to book value, if not more in the short term, once the real-estate exposure was hived off.