(LONDON) - Spain's Santander said Monday it will take over the retail deposits and branches of troubled bank Bradford & Bingley as the British government confirmed that it was nationalising the banking group.

B&B's savings business, which represents its best assets, will be sold to the Spanish company, the Treasury added. Abbey National, the British bank owned by Santander, will pay 612 million pounds (773 million euros, 1.1 million dollars) in the deal.

A spokesman for Santander, said: "The retail deposits and branch network will be taken over by Abbey, details of which will be revealed later."

Media reports suggest that the bank's loans, worth 50 billion pounds and including 41 billion pounds of mortgages, are set to be nationalised.

The move would see B&B become the latest casualty of the global financial crisis that has forced governments worldwide to intervene.

As the Santander deal was announced, US lawmakers agreed on the details of an unprecedented 700-billion-dollar bailout for struggling Wall Street banks to avert the worst financial crisis since the Great Depression.

The Belgian, Dutch and Luxembourg governments also mobilised to help troubled financial group Fortis on Sunday, agreeing to inject 11.2 billion euros, Belgian Prime Minister Yves Leterme said.

Over the weekend, officials from the Treasury, the Financial Services Authority watchdog and the Bank of England met to try to secure the future of B&B, which has also suffered from a prolonged property market downturn.

Treasury minister Yvette Cooper told the BBC on Sunday that "certainly the government is stepping in as part of the process".

"We have been very clear that the priority is to make sure that depositors, that ordinary savers will be properly protected, but also that we can support the stability of the banking system as a whole," she said.

Company spokesman Tony McGarahan said: "We can assure customers that their deposits are safe with Bradford & Bingley."

Shares in both B&B and Fortis have been hammered by liquidity concerns as the credit crunch, which erupted in August 2007, showed no signs of abating.

Bradford & Bingley stock has slumped in recent weeks amid fears it could become another Northern Rock, which was nationalised earlier this year after a severe funding crisis and a run on its branches.

Bradford & Bingley had announced Thursday that it was cutting 370 jobs, mainly at its mortgage processing centre near London, in a bid to save 15 million pounds. The bank employs about 3,200 staff.

Last month, it revealed net losses of 17.2 million pounds for the first half of 2008, attributing them to "turbulence in the banking and housing sectors."

The collapse of B&B, which specialises in mortgages for investors buying homes in order to rent them out, would mark the latest casualty in Britain's banking sector after HBOS was bought by rival Lloyds TSB earlier this month.

British newspapers criticised the deal Monday, acknowledging that something had to be done but expressing concern that taxpayers had to pick up the bill.

"Another weekend of fevered negotiations, another emergency bail-out of a crippled bank... another lousy deal for the British taxpayer," said the populist Daily Mail.

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