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Bradford & Bingley shares soared by 17 per cent in early trading on weekend rumours the bank may be next in line to be taken over.

The Financial Services Authority (FSA) is said to be keen to broker a deal for the bank, which as Britain's biggest buy-to-let lender has suffered from the property slowdown and the credit crunch.

Spanish banking giant Santander, which has recently bought Alliance & Leicester and already owns Abbey, has been named as a potential suitor, along with Dutch group Ing and National Australia Bank.

Bradford & Bingley (B&B) said it is not aware of any talks.

"Our funding foundations are solid and we are well capitalised," a spokesperson for B&B said.

Following last week's turbulence on the financial markets and the dramatic rescue of HBOS by Lloyds TSB, aided by the government, attention has turned to other troubled institutions.

B&B attempted to raise additional capital in June but falling share values in the bank and a failed rescue bid from a private equity group damaged confidence.

The bank relies heavily on buy-to-let and self-certification mortgages, which have higher default rates.

Although shares have risen on hopes of a takeover, the Times has reported that none of the banks approached by the FSA are interested in buying B&B.

If it emerges that no buyer can be found, this may send shares in the lender plummeting, raising fears for its future.