Hugo Chavez, the Venezuelan president, has said he will nationalise the Bank of Venezuela, one of the country's largest.

Chavez on Thursday called on the bank's Spanish owners, Grupo Santandar, to begin negotiations on the price.

In a speech broadcast on Venezuela media, Chavez said he had decided to buy Banco de Venezuela after Santander had asked for permission to sell it to a local finance organisation.

"They wanted to sell the bank to a Venezuelan banker, and as head of state I'm saying no. Sell it to the government, to the state," he said.

"We are going to take back the Bank of Venezuela to put it at the service of the Venezuelans."

Last year the Venezuelan president threatened to nationalise all Venezuelan subsidiaries of Spanish banks after Spain's King Juan Carlos told him to "shut up" during a summit last November, although the two have since reconciled. 

Banco de Venezuela is the South American nation's third largest bank in terms of deposits and the fourth measured by its credit portfolio. It was bought by Santander in 1996.

In the past two years Venezuela government has taken over several key part of the nation's economy, including oil projects, telecommunications and steel and cement plants.