Alliance & Leicester, which is being acquired by Santander of Spain, barely scraped into profit during the first half of 2008 after being hit by £209m of writedowns on its structured credit portfolio.

The former building society reported interim profits of £1.8m against £290m last time after profit was wiped out by the writedowns as well as a further £70m relating to higher funding costs. Core operating profit excluding these exceptionals was £301m (£295m).