Morgan Stanley (MS.US) is set to buy Santander's (SAN.US) mortgage portfolio for around 900 million euros.

Some media outlets have quoted sources as saying that Wall Street financial giant Morgan Stanley (MS.US) is close to agreeing to buy Spanish mortgage assets worth up to 900 million euros ($9.4 billion) from Santander (SAN.US), a Spanish bank headquartered in Spain.

The sources said the two banking giants are currently finalizing the specific terms of the agreement, with Alantra Partners SA acting as Santander's financial investment advisor, and asked not to be named as the negotiations are private. The sources said the specifics are still subject to change, and even the deal could fall through.

Representatives of the two commercial banks and Alantra Partners SA declined to comment.

Separately, media outlets reported last month that Morgan Stanley and AB CarVal Investors were in talks to buy a portfolio of mortgage assets worth about 500 million euros from CaixaBank SA, reflecting Morgan Stanley's keen interest in some valuable mortgage assets.