BRITAIN'S fourth largest building society, Alliance & Leicester, ended months of speculation by yesterday announcing plans to seek bank status via a stock market flotation worth around £2.5 billion sterling.

The news comes after a year long shake up in the sector, the main lender to millions of British home owners, and promises to bring more speculation over the size of the payouts to Alliance & Leicester members if they give the plan the go ahead.

Alliance & Leicester targets its flotation for the first half of 1997. The plan is conditional upon members voting in favour of the conversion and also confirmation by the Building Societies Commission and authorisation by the Bank of England.