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LONDON, Oct 6 (Reuters) - House prices in Britain rose 1.6 percent in September -- more than twice as fast as expected -- leaving prices down 7.4 percent in the three months to September versus a year ago, mortgage lender Halifax said on Tuesday.
Halifax said that price rises had been caused by limited supply in the face of increased demand driven by improved affordability.
((For a graphic comparing the Halifax and Nationwide house price indices, click here: http://r.reuters.com/vef32f))
Prices are now up 5.6 percent from their April low point on Halifax's measure, but at an average of 163,533 pounds ($260,400) are still no higher than in mid-2005.
"The recent revival in house prices is a consequence of sharply reduced mortgage interest rates and more affordable prices due to the substantial fall in house prices from their 2007 peak levels through to the early months of this year," said Howard Archer, chief UK economist at IHS Global Insight.
"It is also clear that house prices have been supported supported appreciably in recent months by a lack of new properties coming on to the market," Archer added.
Analysts had forecast a rise 0.6 percent, for a three-month annual fall of 7.8 percent. Year-on-year, house prices are 4.8 percent lower.
Halifax did not expect prices to keep rising at the same monthly pace.
Continuing increases in unemployment and low earnings growth are likely to constrain the rise in demand," said Martin Ellis, Halifax housing economist.
"There are also some signs that the improvement in market conditions is encouraging more people to put their properties up for sale. This development could loosen market conditions by alleviating the current shortage of supply," Ellis added.

(Reporting by David Milliken) ($1=.6279 Pound) Keywords: BRITAIN PROPERTY/HALIFAX

(Reuters Messaging: david.milliken.reuters.com@reuters.net; david.milliken@reuters.com; +44 20 7542 5109)

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Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.

LONDON, Oct 6 (Reuters) - House prices in Britain rose 1.6 percent in September -- more than twice as fast as expected -- leaving prices down 7.4 percent in the three months to September versus a year ago, mortgage lender Halifax said on Tuesday.
That left the average price of a home at 163,533 pounds ($260,400), the mortgage lender said.
Analysts had forecast a rise 0.6 percent, for a three-month annual fall of 7.8 percent.
(Reporting by David Milliken) ($1=.6279 Pound) Keywords: BRITAIN PROPERTY/HALIFAX

(Reuters Messaging: david.milliken.reuters.com@reuters.net; david.milliken@reuters.com; +44 20 7542 5109)

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By Morag MacKinnon

SYDNEY, Oct 2 (Reuters) - As Suncorp-Metway Ltd CEO Patrick Snowball completes his first month at the helm of the embattled insurance and financial services giant, bidders are circling to see what he will do with the company's troublesome banking assets.
As economic activity improves, the signs are that unlike his predecessors, Snowball has time on his side.
Snowball, a former Aviva Plc insurance executive, brought a team of former colleagues to Suncorp's Brisbane headquarters to help him complete a strategic overview of Australia's fifth-largest bank as he began his four-year term at Suncorp.
The company, which divides its business into banking, insurance and life, last year abandoned the sale of its distressed banking unit just as the Australian government came to the rescue of the financial system with a guarantee on deposits and funding.
With a single A rating from Standard & Poor's, Suncorp relies heavily on costly wholesale funding and securitisation, making it uncompetitive with its higher rated "Big Four" rivals.
As the global credit crisis took hold and Suncorp's fortunes sank, bankers familiar with the situation said Australia and New Zealand Banking Group offered 0.8 times book value, or around A$2 billion ($1.8 billion) for the regional lender.
That was broadly in line with the price Commonwealth Bank of Australia paid for HBOS Plc's BankWest unit last October.
Today, analysts say Suncorp's banking unit is more likely to fetch somewhere in the vicinity of A$1-A$1.2 billion, if it's sold in one lot.
Investors and analysts are speculating on whether Snowball and his team will have found a way to unlock value in the unit or whether they will have decided to fast-track some, or all, of the sale of the nation's last sizeable banking asset to concentrate on its insurance business.
John Grace, a portfolio manager at Ausbil Dexia, says the market is awaiting comment from Snowball on his strategy.
"Clearly there's a challenge in front of him," said Grace. "The urgency that was there is probably not there as much at the moment," he added.
And with Australia's competition regulator likely to attempt to block any further consolidation in the nation's banking oligopoly, the question is, which offshore and local players are eyeing the assets and how long until deals can be done.
Locally, ANZ and National Australia Bank are considered the most likely of the big four lenders to make a bid, according to bankers.
Australia's other big banks, Westpac Banking CorpAX> and Commonwealth, are considered unlikely as both focus on bedding down last year's large purchases of local regional lenders.
Offshore, Rabobank is mentioned by many M&A bankers as a possible buyer of Suncorp's solid agribusiness banking division.
HSBC and Standard Chartered Bank, with relatively small operations in Australia, might also consider picking up some, or all of the assets, they suggest.
"As an entry point into Australia, Suncorp would be a great franchise for any foreign player," said Arjan van Veen, an analyst at Credit Suisse in Sydney.
While its higher cost of funding means Suncorp can't compete in commercial lending, Snowball and his team could sell some of its non-core businesses, such as lease financing and agribusiness, analysts said.
"If it were to go back to a real retail operation, where the core franchise really is, there may be some real value in that," said Rohan Walsh, a fund manager at Karara Capital in Melbourne
Such moves may prove to be stop-gap measures, however.
"They'll probably sell the bank at some stage," said van Veen. "If they hold, they could get a better price."

($1=1.133 Australian Dollar)

(Editing by Lincoln Feast)

((morag.mackinnon@thomsonreuters.com;+61 2 9373 1815)) Keywords: DEALTALK/SUNCORP (If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com)

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LONDON, Sept 24 (Reuters) - Two major British banks got within hours of a liquidity shortfall last October as the financial system teetered on the brink of collapse, according to Bank of England Governor Mervyn King.
In a programme to be broadcast by BBC Television later on Thursday, King describes how strains in the money markets came to a head on Oct. 6 and Oct. 7 last year.
"Two of our major banks which had had difficulty in obtaining funding could raise money only for one week then only for one day, and then on that Monday and Tuesday it was not possible even for those two banks really to be confident they could get to the end of the day," King said, according to extracts released by the BBC.
The two banks were HBOS Plc and RBS, the BBC said.
The British government was forced to shore up the system with billions of pounds of taxpayers' money in a unprecedented rescue mission that was subsequently replicated in many other countries.
"It was, it is probably the worst situation as I say we faced in peace time," said Chancellor of the Exchequer Alistair Darling, according to extracts from the BBC's "Love of Money" programme.

(Reporting by Christina Fincher, editing by Mike Peacock) Keywords: BRITAIN BOE/BANKS (uk.economics@reuters.com +44 207 542 7748; Reuters Messaging christina.fincher.reuters.com@reuters.net)

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Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.