Top executives from four of Britain’s largest banks were locked in talks with the government on Sunday in a frantic attempt to hammer out details of a capital increase likely to be worth tens of billions of pounds before the markets reopen on Monday.

Executives from Royal Bank of Scotland, HBOS, Lloyds TSB and Barclays were debating the extent and structure of capital increases after continued market turmoil at the end of last week prompted the government to force the banks to accelerate their plans.