- RBS branch stormed as bloody skirmishes erupt
- Thousands of protesters held in containment pens
- Barack Obama and Gordon Brown upbeat on G20 deal

Demonstrators have been involved in skirmishes with officers outside the Bank of England in central London Link to this video

G20 protests in central London have turned violent ahead of tomorrow's summit, with a hardcore band of demonstrators close to the Bank of England storming a Royal Bank of Scotland branch, smashing its windows and wrecking the interior.

Riot police are struggling to remove the 20 protesters, some of whom have emerged from the ruined building holding aloft computers, telephones and files.

Although the demonstrations began peacefully, bloody skirmishes have erupted as police try to keep thousands of people in containment pens on Threadneedle street.

Protesters targeted RBS, which is at the centre of a row over £703,000-a-year pension payments to Sir Fred Goodwin, the disgraced former chief executive.

Earlier, Gordon Brown met Barack Obama in Downing Street and later announced that the G20 leaders were "within a few hours" of agreeing a global deal for economic recovery.

By midday, around 60 protesters and police were involved in scuffles, which saw officers pelted with bottles, eggs, fruit and paint. Some officers also had their helmets ripped from their heads and thrown into the air, which was turned pink and red as protesters let off smoke bombs. Police responded by using truncheons, batons and pepper spray.

A group of protesters has been steadily pushing against the police line on Threadneedle street, provoking intermittent skirmishes that have left several officers and demonstrators injured.

Police are using truncheons and batons to beat back the protesters each time they surge forward. Some in the pens have demanded to be released, saying they are being denied the right to march.

Although police efforts to stop the crowd entering the RBS branch initially appeared to be working, the branch's windows were soon smashed by missiles before the protesters swarmed in. Those who came out bearing pieces of office furniture were cheered on by the crowd.

Guardian reporters at the scene have witnessed a handful of arrests, and the Metropolitan police have confirmed that 11 people who turned up at the protest in an armoured personnel carrier were arrested in connection with the possession of police uniforms and road traffic offences. The arrested activists are understood to be anarchists known as the Space Hijackers who had come to make their feelings felt through the medium of street theatre.

At a press conference this morning, Obama and Brown were upbeat on the prospects of a G20 deal and sought to dispel suggestions that a rift with France and Germany was threatening tomorrow's summit.

"The separation between various parties involved has been vastly overstated," the US president said. "All of us here in London have a responsibility to act with a sense of urgency. Make no mistake: we are facing the most severe economic crisis since world war two."

The British prime minister described the UK and the US as "partners of purpose" and said a strategy for recovery was imminent.

"We are within a few hours of agreeing a global plan for economic recovery and reform," he said.

On the streets, however, the mood soured as police and protesters clashed.

Following speeches and songs outside the Royal Exchange, events turned violent when the crowd gathered outside attempted to disperse.

Large numbers tried to make their way down Threadneedle Street towards the climate camp in the City and were met halfway down by a police line.

"It's our street, it's our street," the crowd chanted as it was forced forward on to the police line.

Injured demonstrators with bleeding heads and necks were ushered through the crowd while others handed out milk so that people could wash the pepper spray from their eyes and mouths.Harry, who was dressed as the Grim Reaper, led the procession from Moorgate to the Bank of England. However, his costume did not amuse the police, who demanded that he remove his skeletal mask so they could see his face. He said it was the first time he had marched in 10 years.

"I'm protesting for the small individuals in Britain who have been left with their pants down as the government bails out the banks for billions of dollars. Where's the money for the struggling baker, butcher, small marketing people and architectural companies?"

He accused the government of helping the big boys but "leaving the little boys to sink".

As the four horsemen of the apocalypse danced to the brass bands on the steps of the Bank and peered out over the noisy crowd of thousands, others explained why they had come to protest.

One of the first demonstrators to arrive in Liverpool Street was a 55-year-old man from Worcester.

The man, who did not wish to be named, carried a banner which read: "Punish the looters."

"We need clean capitalism," he said. "Capitalism only works if people don't take more out than they need."

The man, who said he was not "part of any group", added that while he was not certain what the protests would achieve, he thought it important to take part.

"To be honest, I'm not sure this will make any difference. The same people will still be in power. But at some point you have to take a stand and I could not stand by any more and do nothing.

"Maybe someone somewhere will listen to my little voice and I will make a little difference."

A nurse from Hertfordshire, who gave her name as Mirthful Merryweather, said she was a member of the People's United Collective.

"I am here to make sure that peace happens rather than war," she said. "I hope it will be peaceful. I think the most likely source of trouble is from the police."

There were few signs of pinstriped suits, as many City workers heeded advice to dress down. Dozens of police officers congregated around the tube stations as the activists began to grow in numbers.

The scale of the policing operation was evident outside the Bank, where surveillance teams looked on from the roof while their colleagues stood by the crowd pens erected to corral the protesters.