The euro zone's biggest bank, which has suffered less than domestic rivals from a severe Spanish economic downturn, is looking to raise between $3 billion and $4 billion in the offering, Reuters' IFR reported last week.

The bank plans to list about 25 percent of the unit, which is Mexico's third-largest bank by assets, with just over 6 percent being sold in Mexico and 18.7 percent abroad.

Santander said in a preliminary prospectus that it saw Mexico as a good growth prospect due to its sound economic fundamentals, young population, growing middle class and low penetration of banking services.

The bank had 841 billion Mexican pesos ($64.10 billion) in assets and a loan portfolio of 338.9 billion pesos at the end of June.

The listing will be the third this year on Mexico's stock exchange, which has in recent years sharply lagged its larger Latin American neighbor Brazil in attracting companies looking for capital. ($1=13.12 Mexican pesos) (Reporting by Lizbeth Salazar, writing by Elinor Comlay; Editing by Neil Fullick)

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