According to a report in the Financial Times, the organization will be chaired by Lord Levene, the outgoing chairman of the Lloyd's of London insurance market.
He will be joined by Lord McFall, the former head of the Treasury select committee, Charles McCreevy, who previously worked as an EU internal markets commissioner and Sir David Walker, who wrote a report on corporate governance in 2009.
The men are initially attempting to raise around Â£50 million ($75.9 million) and have approached around a dozen institutional investors so far.
Once the venture is off the ground, it will look to purchase government-backed assets such as Northern Rock and the portfolio of 600 bank branches that Lloyds has been ordered to divest by 2013.
Earlier this month, Lloyds announced it is to sell 40 of its private equity investments to a new venture company 70 per cent owned by Coller Capital.
Coller will pay Â£332 million for the stake, with Lloyds retaining 30 per cent ownership of the investments.
By Tony Aynsley