Halifax Bank of Scotland (LON:HBOS) is in trouble. In case you haven’t been paying attention to Britain’s markets, the US has exported its real estate collapse and credit crisis to the Britain. And now the country’s largest mortgage lender is groping for anything to prop itself up.

So far HBOS has posted nearly GBP£4 billion (about $7.95 billion) in writedowns from the Britain’s failing real estate market. And in lieu of selling chunks of itself to foreign banks to bring capital back into the company, HBOS’s shareholders just voted today to issue 1.5 billion new shares in a rights sale next month.

The stock is currently trading at 276 pence (GBP 2.76 or about $5.48), only one pence above the pricing for the rights issue. And the bank’s stock still has three weeks to run before the issue. If it slides below the 275 pence pricetag on the rights issue, investors won’t be very interested in buying up new shares at a premium to the market.

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And that may be the moment when National Australia Bank (ASX:NAB) makes a formal offer for the Australian branch of HBOS. NAB, the country’s largest bank, has already begun discussing the feasibility of an offer with advisory firms in London, but hasn’t yet approached HBOS with an offer.

HBOS Australia would be a logical expansion choice for National Australia. HBOS, headquartered in Perth, has capitalized on the mining boom in Western Australia, while National Australia is centered on the more populated east coast. And HBOS may be able to sell the subsidiary for as much as GBP 3.7 billion ($7.3 billion).

Now the question is, how much money does HBOS Australia make for its parent company, and how much is HBOS willing to sacrifice to stay afloat during the credit crisis?

Source: Is HBOS Selling to National Australia Bank (NAB)?