Granada Film, which recently won the Golden Bear at the Berlin Film Festival for Bloody Sunday, is to close as a separate operation.

The film-making arm of the TV and media group Granada will be brought in-house to become part of the comedy and drama department.

The news comes soon after the closure of Film Four and will leave the BBC as the only British broadcaster with a significant stand-alone film-making operation.

Granada Film founder Steve Morrison recently left the group

"Film will be run by the controller of comedy and drama, Andy Harries," a Granada spokeswoman told BBC News Online.

"He wants to focus on a smaller slate of films aimed at British audiences," she said.

The spokeswoman confirmed that Granada would continue to make films for cinema release.

Pippa Cross and Jeanette Day, who head Granada Film, are to set up an independent production and sales company to complete production of two films already in the pipeline, All-American Man and Vanity Fair.

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Granada Film is in good financial health, but that the media group was now restructuring to concentrate on TV, the trade magazine Variety reported on Wednesday.

Granada and other ITV companies have been hit by the collapse of ITV Digital and the recent slump in advertising revenues.

The founder of Granada Film, Steve Morrison, recently resigned his post of chief executive of the group.

Granada Film produced a series of successful movies for cinemas and TV, including the Oscar-winning My Left Foot in 1990.

Besides cinema releases Girls Night, Essex Boys and The House of Mirth, it also made the award-winning Longitude and Seeing Red for TV.

Bloody Sunday, which was shown on ITV earlier this year, was a drama based on the deaths of 13 civilians in a Londonderry demonstration on 30 January 1972.

The film starred James Nesbitt, Nicholas Farrell and Tim Piggott-Smith.

Despite some UK press criticism for its political stance, it won the audience award at the Sundance Film Festival and the Golden Bear for the best film at the Berlin Film Festival.