Wall Street looked set to rally Monday following a series of measures and cash injections by governments and central banks designed to prop up the banking sector and avoid a global meltdown.

British bank Lloyds TSB said it has renegotiated its agreed takeover of rival HBOS as both banks unveiled plans to accept government money to bolster their finances.

Britain bailed out three major banks with 37 billion pounds ($64 billion) on Monday, as European governments used taxpayers' cash to take control and boost confidence in the battered industry.

The UK government could become the largest shareholder in Royal Bank of Scotland and HBOS, according to a report.

Britain will launch its biggest retail bank rescue on Monday when the four largest, HBOS, Royal Bank of Scotland, Lloyds TSB and Barclays, ask for a 35 billion sterling ($60.5 billion) lifeline, the Sunday Times reported.

European wholesale and investment banks will likely incur 28.4 billion euros of pre-tax writedowns in the second half of 2008, according to J.P. Morgan Securities.

The Federal Reserve and the world's top central banks offered to pump billions of dollars into global money markets on Thursday in a coordinated effort to ease a funding squeeze triggered by the upheaval on Wall Street.

Lloyds TSB sealed a rescue takeover of HBOS on Thursday to create a dominant British mortgage and savings bank in a $22 billion deal helped through by the government.

Lloyds TSB rescued Britain's biggest mortgage lender HBOS on Thursday in a $22 billion takeover as the government swept aside competition rules to ease the deal through.

Shares of UK bank HBOS have been hit hard of late and are bouncing around Wednesday on speculation of a possible deal with Lloyds TSB.

Wall Street suffered another beating Wednesday at the hands of investors panicking over the state of large banks, as they flocked from stocks and sent safe-haven areas like gold soaring.

British bank Lloyds TSB is in advanced talks to buy rival HBOS to create a 24 billion pound mortgage giant as the credit crunch forces more troubled banks into the arms of better funded rivals.

Shares in Britain's biggest home lender HBOS slumped over 21 percent Tuesday and the cost of insuring its debt against default jumped on Tuesday as concern mounted about higher funding costs and potential writedowns.

European earnings were mixed Thursday, with telecoms reporting results in line or above forecasts, while energy companies and financials posted profit declines or figures below market expectations.

U.S. investment bank JP Morgan has held talks with potential partners about forming a consortium to break up British bank HBOS, the UK's Telegraph newspaper reported on its Web site.