Abbey may receive a rival bid from banking giant HBOS

Juan Inciarte, the Santander executive in charge of the Abbey bid, said at the weekend that he hoped to wrap up the deal by November.

Santander, Spain's biggest bank, had previously said the Abbey deal would be complete by the end of the year.

The move could force potential rival bidders to show their hand.

HBOS under scrutiny

There has been widespread speculation that British banking giant HBOS may launch its own bid for Abbey, even though any such move is likely to trigger a probe by UK competition watchdogs.

Abbey agreed to Santander's �8bn takeover offer in late July.

Buying Abbey is seen as the last major merger opportunity within the British banking sector, which has undergone a wave of consolidation in the past ten years.

Abbey, known primarily as a mortgage lender, has been seen as a bid target since an ill-fated foray into corporate banking led to hefty losses two years ago.

The company, whose shareholders include large numbers of small investors, has recently returned to profitability under chief executive Luqman Arnold.