A bid for Northern Rock will not come in above 190p – that's the conclusion of broker Collins Stewart, as reports of a private equity takeover emerge.

Embattled mortgage lender Northern Rock is up 17p to 153p per share in early trading on speculation that private equity firm JC Flowers is lining up a bid.

But Collins Stewart analyst Alex Potter says: 'We see 190p as the ceiling for bids and, with most other bidders reportedly having dropped out, we doubt that Flowers would bid as high as that level. We would continue to sell into any strength and again caution that this is a very high-risk situation.'

It has been reported JC Flowers, founded by former Goldman Sachs partner Chris Flowers, has secured £15 billion of funding to bankroll a takeover. This follows speculation yesterday the bank had put accountants at Grant Thornton on the ready to act as administrator.

A Northern Rock spokesperson today re-iterated the bank is still in discussions with 'various' parties, saying: 'We are exploring a range of possible options and are speaking to a range of parties. We are not commenting further on possible transactions or parties at this stage.'

Reports on JC Flowers' preparations says the private equity group is interested in keeping Northern Rock as a whole entity and is understood to have received funding commitments from blue chip banks.

The cash could be used to refinance part of the estimated £20 billion that analysts believe the bank will need to raise in the next year, the reports said.