LLOYDS TSB Group Plc, the United Kingdom bank that has agreed to take over mortgage lender HBOS Plc, may face competition from another suitor that has contacted the British government about a possible offer.

Scottish financier Jim Spowart contacted Scottish Secretary Jim Murphy last week about "another potential bid," the Scottish Office said in a statement in London yesterday. For now, though, "there is only one bid," it said.

"The Secretary of State said that if there were another firm bid, the Treasury would be happy to talk to them," the statement said, without giving further details.

The possible bidder is a European financial services company with "worldwide reach," Spowart said, the British Broadcasting Corporation reported on its Website yesterday. There is "genuine, genuine interest" from the company, Spowart said, according to the BBC.

HBOS, based in Edinburgh, agreed to be bought in September after its shares plunged amid concerns with the company's access to cash as the credit crunch discouraged loans between banks.

The takeover was backed by the government, which waived competition restrictions and agreed to underwrite a 17-billion-pound (US$27 billion) share sale to boost capital at the combined firm.