Santander said A&L shareholders would get one of its shares for every three they now hold in the UK bank. Shares in A&L soared by nearly 50% on Monday after it disclosed that it had received a bid approach, which the BBC revealed was from Santander. Santander is effectively offering 317 pence per A&L share and expects the deal to be completed by October.

"So there will be some concern that the disappearance of A&L as an independent entity would leave too much power in the hands of the big banks." David Cumming, head of UK equities at Standard Life Investments, described it as "a gorgeous deal" for Santander, saying the bank was acquiring Alliance & Leicester "on giveaway terms".

"Given the potential integration benefits, other banks must surely be reviewing their options. I would be amazed if no one else counters with a higher offer in the next few months." Shares in other lenders soared on the news, with Bradford and Bingley shares rising by more than 25%.

Full scale work by the Chinese begins to rebuild 2,050 miles of roads in the Democratic Republic of Congo, left to rot in the rainforest after the Belgian colonialists pulled out 48 years ago and further shattered by seven years of war. The vast project, which will triple Congo's current paved road network, is part of China's largest investment in Africa, a £4.5 billion infrastructure-for-minerals deal signed in January. As well as the roads, Beijing has promised to repair 2,000 miles of largely defunct railways, build 32 hospitals and 145 health centres, install two electricity distribution networks, construct two hydropower dams and two new airports.

In return, CHINA HAS WON THE RIGHTS TO FIVE COPPER AND COBALT MINES IN CONGO'S SOUTHERN MINERALS BELT WHICH BOASTS SOME OF THE WORLD'S RICHEST ORE DEPOSITS. The deal has confirmed Beijing as Congo's largest foreign investor and extended its dominance over swathes of Africa previously allied to the West.

Victor Kasongo, Congo's deputy minister of mines, said: "To be honest, China was Plan B. We first approached the Europeans but they said they did not have the muscle to do what we needed. China has stepped into that opening, very quickly."

The US Treasury and Federal Reserve plan, announced on Sunday evening, called for sweeping measures to lend money and buy equity if necessary in Freddie Mac and Fannie Mae, government-sponsored (GSE) enterprises owned by shareholders. The plan was hatched in an attempt to calm investors after stocks of both plummeted more than 40 percent last week on fears the companies, pillars of the housing market, were under capitalised and the credit crisis toppled a fifth U.S. bank.

Fannie and Freddie own or guarantee $5 trillion (2.5 trillion pounds) of debt, close to half the value of all U.S. mortgages. Foreign central banks, mostly in Asia, hold $979 billion of the bonds and mortgage-backed bonds sold by the agencies. "[Their] continued strength is important to maintaining confidence and stability in our financial system and our financial markets," U.S. Treasury Secretary Henry Paulson said in a statement that he read on the steps of the Treasury building.

"Therefore, we must take steps to address the current situation as we move to a stronger regulatory structure," he said. Fannie and Freddie's shares have been savaged in recent days and reduced to a fraction of their value a year ago and analysts remain sceptical.

Fannie Mae - Formerly FNMA or Federal National Mortgage Association
Freddie Mac - Federal Home Loan Mortgage Corporation

But after a large mortgage lender in California collapsed late Friday, Wall Street analysts began posing two crucial questions: Just how many banks might falter? And, more urgently, which one could be next?

The nation's banks are in far less danger than they were in the late 1980s and early 1990s, when more than 1,000 federally insured institutions went under during the savings-and-loan crisis. The debacle, the greatest collapse of American financial institutions since the Depression, prompted a government bailout that cost taxpayers about $125 billion.

But the troubles are growing so rapidly at some small and midsize banks that as many as 150 out of the 7,500 banks nationwide could fail over the next 12 to 18 months, analysts say. Other lenders are likely to shut branches or seek mergers. The FDIC has $53 billion set aside to reimburse consumers for deposits lost at failed banks. IndyMac will eat up $4 billion to $8 billion of that fund, the agency estimates, and that could force it to raise more money from the banks that it insures.

A quarter-by-quarter breakdown suggests that the offending has accelerated over the course of the year, fuelling fears that the problem is getting worse. Opposition politicians described the tally as "shocking" and last night demanded action from ministers. Six people died in knife attacks in a 24-hour period last week, leading to an unprecedented statement from Scotland Yard aimed at reassuring the public.

Among the victims was Melvin Bryan, an 18-year-old who became the 42nd teenager killed in Britain this year and the 20th in London.

Gordon Brown called Sir Ian Blair, the Metropolitan Police Commissioner, to Chequers yesterday, for urgent talks. The Prime Minister urged the Scotland Yard chief to make full use of new police powers to make pubs and clubs search customers for knives and guns.

"Before the enemies can put their fingers on the trigger, the armed forces will cut off their hands," Ahmadinejad was quoted as saying. The remarks, delivered Sunday, came just days after Iran conducted long-range missile tests and threatened to target "the heart of Israel" and 32 U.S. bases in the Middle East if those countries attacked Iran.

"This is only a small part of Iran's defense capabilities and in the future we will unveil more of our defense capabilities if it is needed," he said. Iranian officials said Wednesday that the country test-fired its Shahab-3 missile - a longe-range weapon that it says can reach Israel - and eight other missiles.

The U.S. airline industry - including Virgin America - has been battered by soaring fuel costs that are pinching even the healthiest airlines. "The financial state of the world is just about the worst I've ever known it," Branson told The Times newspaper in an interview. "It's getting perilously close to being worse than the 1990s."

"You have the perfect storm - you've not only got the banking crisis and the housing crisis, you've got the soaring fuel prices as well. One of the big American carriers will almost definitely go."

The ceremonial inaugural summit at the lofty iron-and-glass Grand Palais in Paris sealed a new détente between Syria and Europe, with the Syrian and Israeli leaders also sitting at the same table for the first time. But there was no handshake and Syrian President Bashar al-Assad appeared to go out of his way to avoid Israeli Prime Minister Ehud Olmert, hiding his face behind his arm as he walked past where the Israeli leader was standing.

"Everyone will have to make an effort, as the Europeans did, to put an end to the deadly spiral of war and violence, that, century after century, repeatedly brought barbarity to the heart of civilisation," Sarkozy said in the keynote speech. Egyptian President Hosni Mubarak, co-president of the summit, told the leaders they must work together to meet the challenges of food, education and health for their growing populations.

"I am sure that today is a start. I am sure that we have a long way to go and we will go a long way," he said. On a day rich in political gestures, Sarkozy hosted cordial talks with the Israeli and Palestinian leaders, capped with an effusive triple handshake and a joint news conference.

She has been hand-making Steiff toys for 18 years in Giengen, the tiny south German town where the maker of collectible teddy bears - some worth hundreds of thousands of euros - was founded over 125 years ago. Chasing lower costs, Steiff outsourced around a fifth of its production to China in 2003 but has now decided to come back because of concerns about quality and staff turnover.

Steiff is one of a small number of German firms which are swimming against the tide and leaving China, despite its cheaper workforce and a burgeoning consumer population. With fuel at record highs, some cite mounting transport costs. Production of Steiff toys, which include a distinctive long-limbed bear with a melancholy growl, will come back to Germany and other countries in Europe by the end of 2009.

A PwC study shows that companies can save up to 50 percent making their goods in China instead of Germany, but that firms often underestimate logistics costs. Around a third of companies actually incurred losses by moving production east, the study showed.

The Bishop of New Hampshire, Gene Robinson, said Dr Rowan Williams was trying to overcome deep divisions over the ordination of women and gay people. But he told the BBC: "No matter what he does he makes someone mad." Bishop Robinson is due to preach in London as the Anglican communion gathers for the Lambeth Conference.

The American preacher has been excluded from the event, held every 10 years, but has said he will be in Canterbury, where it is taking place, at the same time. He is also due to speak at St Mary's Church in Putney, south-west London, on Sunday. He said "a mistake was made" in not inviting him to the conference, but he would do whatever he could to raise the issue of gay rights "from the fringe".

Bishop Robinson said he would be doing everything he could to hold the Anglican communion together. "We need each other," he said. "We need the voices from Africa, Asia and South America. We need each other for our mutual salvation." He said he had "no doubt" that Dr Williams was doing his best to retain unity, but added: "I believe that we ought not to be fearful about the Church. The Church is not ours to win or lose. The Church is God's and God will take care of the Church."

He recalled speaking to a group of 12- to 21-year-olds who were questioning their sexuality, all of whom were familiar with a passage from the Biblical chapter Leviticus which describes homosexuality as 'an abomination'. "The Church is responsible for that - it's religious people, Muslims, Jews, Christians - and it's going to take religious voices to undo the hatred that comes from those words."

If such a messianic description really is there, it will contribute to a developing re-evaluation of both popular and scholarly views of Jesus, since it suggests that the story of his death and resurrection was not unique but part of a recognized Jewish tradition at the time.

Daniel Boyarin, a professor of Talmudic culture at the University of California at Berkeley, said that the stone was part of a growing body of evidence suggesting that Jesus could be best understood through a close reading of the Jewish history of his day. "Some Christians will find it shocking, a challenge to the uniqueness of their theology while others will be comforted by the idea of it being a traditional part of Judaism," Mr. Boyarin said.

Most Rabbis and other Jewish scholars have long argued that the death and resurrection of a Jewish Messiah was a "Christian" invention, not part of long-established Jewish thought or Biblical teaching. But a front-page story in Haaretz, a leading Israeli newspaper, just a few days ago has a lot of people asking: Are Jews really supposed to believe their Messiah will actually die and rise again, and was this really Orthodox religious thinking before the time of Jesus?

Two years ago biofuels were still being hailed as a dream solution to what was seen as one of the most urgent problems confronting mankind - our dependence on fossil fuels, which are not only finite but seemed to be threatening the world with the catastrophe of global warming.

Since then, however, the biofuels dream has been disintegrating with the speed of a collapsing card house. Environmentalists, formerly keen on this "green energy", expressed horror at the havoc it was inflicting on the world's eco-systems, not least the clearing of rainforests to grow fuel crops.

As the world suddenly faced its worst food shortage for decades, sending prices spiralling, experts pointed out that a major cause had been diverting millions of acres of farmland from food production to fuel. The damage this was inflicting on the world's poor led a United Nations official to describe the rush for biofuels as "A CRIME AGAINST HUMANITY".

"If you don't have targets you don't make progress," says a Commission spokesman, adamant that the 10 per cent biofuels target cannot be altered. With the powerful US farmers' lobby, backed by President Bush, equally insistent that nothing can be done to change a policy which, according to the FAO, COULD SOON SEE NEARLY A THIRD OF US FARMLAND DIVERTED TO BIOFUELS, it seems this "crime against humanity" is set to continue.

While there are no plans to withdraw before George W Bush hands over to the new American president at the turn of the year, the decision is now expected to be made "in the first half of 2009". Only troops training Iraqi military or police and special forces are likely to stay, unless there is a sharp change for the worse. In an indication of Britain's keenness to withdraw, Des Browne, the defence secretary, emphasised last week that IRAQI TROOPS WERE BETTER ABLE TO KEEP SOUTHERN IRAQ PEACEFUL THAN BRITISH SOLDIERS.

The two sides had been negotiating a Status of Forces Agreement that would provide a legal basis for US troops to remain when a UN mandate expires at the end of the year. But in the past week Iraqi leaders have spoken of only agreeing what they call a memorandum of understanding. Prime Minister Nuri al-Maliki has also raised for the first time the prospect of setting a timetable for US troops to leave Iraq.

The Washington Post quoted one US official close to the negotiations as saying "WE ARE TALKING ABOUT DATES", even though Bush has previously rebuffed calls for a timetable. Iraq is a major issue in November's presidential election battle between Republican John McCain and Democrat Barack Obama. McCain supports the Bush administration's current strategy, while Obama has called for a timetable for withdrawal.

No final decisions had been made, but up to three combat brigades in Iraq could be withdrawn, or slated for withdrawal, by the end of the administration in January, the Times said. The White House declined to discuss the withdrawals, but spokesman Gordon Johndroe told the newspaper that while Bush hoped to bring more troops home, he would await recommendations in September from General David Petraeus, the US commander in Iraq, the Times said.

The BBC was also told that China was training fighter pilots who fly Chinese A5 Fantan fighter jets in Darfur. China's government has declined to comment on the BBC's findings, which contravene a UN arms embargo on Darfur. The embargo requires foreign nations to take measures to ensure they do not militarily assist anyone in the conflict in Darfur, in which the UN estimates that about 300,000 people have died. More than two million people are also believed to have fled their villages in Darfur, destroyed by pro-government Arab Janjaweed militia.

China has chosen not to respond to the BBC's findings. Its public position is that it abides by all UN arms embargoes. China has said in the past that it told Sudan's government not to use Chinese military equipment in Darfur. Sudan's government, however, has told the UN that it will send military equipment wherever it likes within its sovereign territory.

China buys most of Sudan's oil and believes that what Sudan needs is good business partners, help with development and a solid peace process in Darfur, instead of confrontation and sanctions from the West. So when China's President Hu Jintao visited Sudan in 2007 he wrote off millions of dollars worth of debt and donated a multi-million pound interest free loan for a new presidential palace to Sudan's President Omar al-Bashir. In April last year, China's military leaders pledged to strengthen co-operation with Sudan.