British police and security services had previously investigated one of the Islamist militants who carried out Sunday's attack in London, but with resources scarce, he was not deemed enough of a threat to warrant close monitoring, police said yesterday.

The news raises questions about the police's judgment and increases pressure on Prime Minister Theresa May, who, with a national election tomorrow, is facing criticism for overseeing cuts to police during her years as Interior Minister.

In Britain's third Islamist attack in as many months, three men on Sunday rammed a van into pedestrians on London Bridge before running to the Borough Market area, where they slit throats and stabbed people indiscriminately. Seven people were killed and dozens wounded.

All three attackers were shot dead by police, who have since made at least a dozen arrests in east London and carried raids.

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Police yesterday named two of the attackers and said they were trying to identify the third. One, 27-year-old Khuram Shazad Butt, was a British citizen born in Pakistan who had already been investigated by police and Britain's domestic spy agency, MI5.

"However, there was no intelligence to suggest that this attack was being planned, and the investigation had been prioritised accordingly," police said.

Another attacker, 30-year-old Rachid Redouane, went by the alias Rachid Elkhdar and claimed to be Moroccan or Libyan, police said. He and Butt lived in the same area of east London.

One of Butt's neighbours, Ikenna Chigbo, told Reuters he had chatted with Butt - also known as "Abz" - just hours before the attack on Sunday and said he appeared "almost euphoric".

"He was very sociable, seemed like an ordinary family man. He would always bring his kid out into the lobby."

Another neighbour, Michael Mimbo, told Reuters that Butt supported the north London football team Arsenal. One of the dead attackers has been pictured wearing an Arsenal shirt.

Mimbo said Butt had grown a longer beard and worn traditional Islamic dress more often over the two years he had known him, but showed no sign of radicalisation.

Police said yesterday they had released all 12 people arrested in the neighbourhood without charge.

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Thousands of people attended a vigil at London's Potter's Field Park yesterday for the victims of Sunday's attack. Photo / AP
Thousands of people attended a vigil at London's Potter's Field Park yesterday for the victims of Sunday's attack. Photo / AP

The rampage followed a suicide bomb attack which killed 22 adults and children at a concert in Manchester two weeks ago, and an attack in March when five people died after a van was driven into pedestrians on London's Westminster Bridge.

May described the latest incident as "an attack on the free world".

But with Britons due to vote tomorrow, her decision to reduce the number of police officers in England and Wales by almost 20,000 during her six years as interior minister from 2010 to 2016 shot to the top of the political agenda.

May did not answer repeated questions from reporters on her cuts, but said counterterrorism budgets had been protected and police had the powers they needed.

Police said they had to prioritise resources on suspects who were believed to be preparing an attack or providing active support for one. Butt did not fall into this category when they last investigated him.

"It's just a fact that, over the last seven years, we as a city have lost 600 million pounds from our budgets. We have had to close police stations, sell police buildings, and we've lost thousands of police staff," said London Mayor Sadiq Khan, a member of the opposition Labour Party.

May's main opponent, Labour leader Jeremy Corbyn, backed calls for her resignation over the police cuts.

- Reuters