The state-owned lender has spun off a savings and mortgage bank called Northern Rock plc – effectively the good bank that will be sold off into the private sector.
Its more toxic loans have been retained in the existing bank, renamed Northern Rock Asset Management, which will remain in public ownership.
Suitors are reportedly lining up to take over the good bank as the UK government is expected to kickstart the sale process soon.
Virgin Money – headed by chief executive Jayne-Anne Gadhia – is widely seen as a front-runner having launched a failed bid for Northern Rock before it fell into public hands.
National Australia Bank – which owns Clydesdale and Yorkshire banks – was also reported at the weekend to be considering entering the fray. It is said to be sounding out advisers over a possible bid.
Northern Rock remained tight-lipped on any sale process, saying only that it was at a "very premature stage" and that there was no set timetable for disposal.
Regulators are also keen for new entrants to the sector following the dramatic consolidation seen in the wake of the financial crisis.
A number of fledgling groups are looking to capitalise on the shake-up of the UK banking sector, with assets from Lloyds Banking Group and Royal Bank of Scotland also on the sale block.
Alongside Virgin Money, a bank being created by former Panmure Gordon banking analyst Sandy Chen is thought to be among those set to receive clearance for a licence some time early this year.
There is also reportedly a start-up backed by the US entrepreneur Vernon Hill, called Metro Bank, which is close to securing its UK banking licence.
Gary Hoffman, chief executive of Northern Rock plc, said: "I am pleased to announce that we have successfully completed the legal and capital restructure of the business.
"This helps to build a stronger future and delivers value to taxpayers."