UBS was Barclays’ preferred merger target, with the principal prize the UBS private bank, not long before it bought the US assets of the collapsed investment bank Lehman Brothers, the Financial Times has reported.

The paper, citing unnamed current and former directors, states that senior executives at Barclays Capital proposed UBS as a better option than Lehman at a July 2008 board meeting.

The jewel in the crown, people inside the company say, would have been UBS’s private bank, the world’s largest wealth manager at the time.

Subsequently, the fortunes of the two firms have diverged, with Barclays Wealth expanding as a private wealth management business – announcing a major investment drive in the past few weeks – while UBS is trying to recover after suffering client outflows and a protracted tax case in the US.