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MSE News: Blow for Bradford & Bingley shareholders
Former_MSE_Guy
Posts: 1,650 Forumite
This is the discussion thread for the following MSE News Story:
"Investors in the nationalised bank should receive no compensation for their shares, the independent valuer has said ..."
"Investors in the nationalised bank should receive no compensation for their shares, the independent valuer has said ..."
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Seeing as B&B has left a great big hole in the FSCS finances, it was naive for any shareholder to think they would have got any money. The The B&B Shareholders Action Group are deluded. For the firm to have a value which can be returned to shareholders, it would have to pay its liabilities and it hasnt and wont do that. So, why do they think they should get money?I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0
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There was 400m left but thats how much it cost to find out if there was any money left
Seriously though, the cheap quick money to fund the debt was around for years. Then one day, it wasnt there and these banks had the rug pulled out from them and they werent there either then.
So they suffered both an increase in costs because they never had their own money to lend out. Also at the same time suddenly the assets were declared less worthy also which doubles the costs of the debt lent against them and leads to a nasty spiral.
The only way B&B could be make a profit from all the 'assets' is if every borrower proved the market wrong and paid back their debt immediately and gave the bank its profit up front, otherwise the costs eat into what little they make.
This wont be the last example. Short term debt to fund long term liabilities is how USA government is structured.
We are slightly better off but that is a disaster waiting to happen, greece was another example where the market refused to fund them at a reasonable cost0 -
That has to be before the FSCS payment and Govt underwriting costs. The FSCS has a claim against the assets to recover its costs (which it never will).There was 400m left but thats how much it cost to find out if there was any money left
The FSCS paid out £14 billion to Banco Santander in order for it to take on those deposits covered under the FSCS scheme. The government has had to put up an additional £4 billion to cover those assets not protected under FSCS.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Does this loss to shareholders extend to the Rights Issue that B & B launched?0
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The rights issue was an offer of ordinary shares, so yes, it applies to those as well.2lurcherman wrote: »Does this loss to shareholders extend to the Rights Issue that B & B launched?I am a Chartered Financial Planner
Anything I say on the forum is for discussion purposes only and should not be construed as personal financial advice. It is vitally important to do your own research before acting on information gathered from any users on this forum.0 -
I'm no financial expert. Just a very ordinary member of the public, and I felt I was well done over having been persuaded, in the material sent to me from B&B, that it would be a good idea to buy the shares offered just weeks before the collapse at an admittedly 'reduced' price. I feel that I was totally misinformed about what was going on and this played on the ignorance of the general public. There was no sense that it was about to collapse big time for those of us who are mere mortals, and I felt I acted on good faith in buying them. I feel totally cheated, robbed, etc., having thrown good money after bad, losing that money, in addition to the rest of the money I already had in B&B shares. I never bought them to 'gamble', I had faith. I don't have money to burn, I have children to keep. Never again will I trust a bank.0
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Can I just suggest to the people confused about why their shares are worth nothing.... for god's sake, don't get suckered into buy Ocado shares if you're an eligible customer!Sig to go here...0
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One assumes the true value of the assets nationalised is less then compo paid to cover deposits.. if this later turns out to be untrue ( after costs) and the FSCS is repaid in full , I guess shareholders will have a pointAny posts on here are for information and discussion purposes only and shouldn't be seen as (financial) advice.0
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Cant help thinking that the high flying big investors who had more to loose than the man in the street like myself got wind of what was about to happen and weighed in their investments before the crash dissapearing into the sunset leaving the pot empty ..... i only hope they bought shares in BP0
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The big investors can offset losses against their profits and the risk reward on holding these was worth it as its tax deductable for them0
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