James Crosby, chief executive of HBOS, blamed the risk of being blocked by competition watchdogs and the fear of overpaying for today’s decision.
He said: “The heart would have loved to have done it, but the head says, ‘Don’t compromise what you are already doing for your shareholders.’”
Abbey shares had been trading higher than Santander’s equity based offer, in anticipation of a HBOS bid.
Commenting on the development Mark Mountney, managing director of Premier Mortgage Management, said: “HBOS may have found out how much Santander would have increased its bid by, or the fear of the monopolies commission has made them think twice.”
