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NATIONAL Westminster Bank led the gains in the banking sector, rising nearly 20 per cent as hopes of further interest rate cuts rose on further evidence of an economic slowdown. NatWest was also boosted by news that Abbey National has agreed to buy three businesses - which lend to buyers of cars, business equipment and consumer goods - for pounds 347m.

Martin Gray, of NatWest Retail and Commercial, said Britain's third-largest bank decided it wanted to be a leader in its chosen businesses and to deal directly with its customers. NatWest expects to make a pounds 115m profit on the sale and will also take a pounds 20m charge to reorganise Lombard's remaining business. Copyright: IOS and Bloomberg