Britain’s new National Wealth Fund has struck a £1bn deal with two of Britain’s biggest high street lenders to retrofit thousands of homes to upgrade their energy-efficiency.

Sky News has learnt that the government-backed vehicle has agreed with Barclays and Lloyds Banking Group to provide partial guarantees on loans to housing associations across Britain.

An industry source said the deal, one of the first to be unveiled since the National Wealth Fund’s (NWF) creation, would be announced within days.

One banking insider said the partnership between the NWF and the two high street lenders would enable a substantial number of homes to be retrofitted.

It was, they added, an example of the public and private sectors working in tandem to deliver a worthwhile social outcome.

The scale of the loan guarantees provided by the state-controlled vehicle was unclear on Wednesday.

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A separate deal with the Housing Finance Corporation valued at about £150m is also expected to be announced alongside the broader agreement with Barclays and Lloyds.

The NWF is absorbing the UK Infrastructure Bank, under plans announced this week by Rachel Reeves, the chancellor.

The Treasury intends to inject £5.8bn into the National Wealth Fund, less than the £7.3bn that Labour pledged in its election manifesto.

Barclays and Lloyds both declined to comment, while the Treasury has been contacted for comment.