Hi, I am new to the forum so I have got my tin hat on.

My wife is on her second spouse settlement visa which is due to expire 2013.

Would she able to apply for British citizenship?

She has the relevant English requirement (Level 1) and has passed The Life in the UK test.

She is in full time employment and has her own bank account etc

Is there anything else that she requires?

In hindsight we should have applied for ILR instead of the second visa, but finding out at a very late stage that the Home Office required an English assessment we plumped for the settlement visa.

She needs to have no time restriction on her stay in the UK, eg. ILR, before she can apply for British citizenship.

Assuming you are British, see Requirements for naturalisation if you are married to or the civil partner of a British citizen for the full sp.

Confused when you say "second spouse settlement visa."

Do you mean she originally entered on a spouse visa and when that expired obtained Further Leave to Remain in the UK? If so, then, provided she has lived in the UK for at least 24 months and satisfies the other requirements, she can apply for ILR now and does not have to wait for her FLR to expire.

Yes, I am British. So effectively we will have to wait until the current visa expires in 2013, apply for ILR and then Citizenship?

Depends; see the final paragraph of my above post:-

Do you mean she originally entered on a spouse visa and when that expired obtained Further Leave to Remain in the UK? If so, then, provided she has lived in the UK for at least 24 months and satisfies the other requirements, she can apply for ILR now and does not have to wait for her FLR to expire.

Yes, the second visa was FLR. She has been here a total of 3 years and 1 month. So I can apply for ILR now and then Citizenship?

Assuming all the other requirements are met; yes.