The high street banks that backed the controversial return of Debenhams to the public markets last year have struggled to refinance most of the retailer's £1bn-plus debt. The Sunday Telegraph yesterday on Sunday published that the four banks that arranged the refinancing - HBOS, Royal Bank of Scotland, Lloyds TSB and Barclays - are still sitting on the bulk of the debt some eight months later, despite considerable efforts to sell the debt to other banks and institutional investors.

Debenhams has come to epitomise the so-called "quick flip", where private equity houses buy a business cheaply, load it up with debt and then sell or float it at a huge profit a couple of years later. In this type of transaction the high street banks would normally have syndicated most of the debt within a couple of months of the deal. But some of the banks were still having individual conversations with potential investors in the past few weeks. "They have been having a few quiet discussions with a couple of hedge funds about selling it," said a fixed-income trader.