Updated from 2:25 a.m. EDT

The U.K. government Monday confirmed it planned to nationalize Bradford & Bingley after reaching a deal for Spanish banking giant

Banco Santander

(STD)

to buy the troubled U.K. mortgage lender's 21 billion pound deposit book and branch network for about 600 million pounds.

The bank was taken into public ownership after it saw retail savers withdraw "tens of millions of pounds" in recent days as uncertainty grew, the

Financial Times

reported on its Web site.

Bradford & Bingley's retail deposit business and branch network are being transferred to Banco Santander's Abbey National unit. The lender's mortgage and personal loan books, headquarters and treasury assets will be taken into public ownership.

In February, the U.K. government was forced to take over another mortgage lender, Northern Rock PLC.

This article was written by a staff member of TheStreet.com.