The LVF has ordered its units to stand down

It said the decision was taken in response to the IRA move to decommission arms in September.

Earlier a group of church and community figures said a loyalist feud between the LVF and the rival UVF was over.

The move has been welcomed by politicians but some, especially nationalists, will wait to be convinced by the loyalists' actions.

A statement by the LVF said that the move would take effect from midnight on Sunday.

The LVF was formed by Portadown loyalist Billy Wright after the Ulster Volunteer Force (UVF) leadership stood down his unit in 1996.

Wright was shot dead in the Maze prison by republicans in December 1997.

On Sunday, the Reverend Mervyn Gibson said the loyalist feud, which claimed four lives in Belfast in July and August, had "permanently ended".

He said the group of church and community figures had been holding mediation talks "for some time".

The end of the feud had been widely expected, with no fresh violence happening since August.

The Independent Monitoring Commission had blamed the UVF for the four summer murders.

I pay tribute to those who have worked so hard to bring this resolution about Nigel Dodds DUP North Belfast MP

A special report in September by the ceasefire watchdog said the LVF carried out two murder bids, but their violence was mainly a response to UVF attacks.

The report on the loyalist paramilitary feud led Northern Ireland Secretary Peter Hain to declare the UVF ceasefire had broken down.

BBC Northern Ireland security editor Brian Rowan said the "choreography" of this process may also see the UVF issuing a statement.

"None of this is a surprise - it has been well signalled and widely reported in recent days," he added.

Feud

DUP North Belfast MP Nigel Dodds said he "warmly welcomed" the end of the feud.

"Communities have been set on edge and put into turmoil. I pay tribute to those who have worked so hard to bring this resolution about," he added.

The LVF move was given a cautious welcome by Sinn Fein assembly member Gerry Kelly.

"Given the history of the LVF, nationalists and republicans will of course be cautious of anything being said or promised by them," he said.

"This grouping has a history of sectarian violence, murders and widespread drug dealing, so with relation to the LVF, it is very much wait and see."

Ulster Unionist leader Sir Reg Empey said the move was another positive development in the political process.

"Yesterday's announcement that the feud is over, last week the UDA sent a delegation to see the decommissioning body and Gerry Adams, for the first time allowed the words 'the war is over' to pass his lips," he said.

"Now when we take all those things together I think we have had a fairly positive week and something that I think we need to build on."

The SDLP's former assembly member Brid Rogers said many people in the Upper Bann constituency had been murdered by the LVF.

"The litany of atrocities in this area is awful and it is too late for all those people too late for them, too late for their families."