Abbey National today announced a massive drop in profits.

The bank, which has its regional head office in Bradford and employs about 1,800 people in the city, revealed its pre-tax profits for the six months to June were £697 million - down 34 per cent for the same period last year.

The bank blamed losses on asset disposals and bad loans for the low figures.

The bleak results come just days after the resignation of its chief executive Ian Harley.

Mr Harley resigned following strong criticism over the firm's recent performance.

Shares in Abbey, which fell after a profit warning, have dropped by a third since the beginning of the year.

Industry insiders say the slump has made Abbey ripe for a takeover bid from the National Australia Bank.

Lord Burns, Abbey's acting chief executive, said the firm is now set to focus on the UK retail financial services market to improve its figures.

He said: "There are still tough challenges to overcome, but we are tackling these head on."

Today's figures were in line with the bank's own lowered forecasts.