Santander to buy Alliance Leicester

Spain's largest bank, Banco Santander, has reached an agreement to buy mortgage lender Alliance and Leicester (A&L) in a deal worth £1.26bn. Santander acquired British bank Abbey in 2004 and will offer one of its shares for every three shares in A&L

A statement said the acquisition would allow the combination of A&L and Abbey's complementary business operations to enhance the competitive positioning of the products and services offered by the group. The lender has confirmed that it will remain a separate brand from Abbey for the ‘short term’, but would not be drawn on its long term future as a separate entity.