Oh dear - Bradford & Bingley nationalisation looks increasingly likely

Generali

baby_boomer wrote: »

If it was Santander, you can imagine the cost cutting exercise that could follow were they to own Abbey/A&L and B&B.

I guess someone like Santander could be interested if they felt that they could integrate and administer the savings book very cheaply.

It'll be interesting to see where the staff and pension liabilities go. I think this means that the staff pension scheme has a big deficit. I'm not sure though (and I hope for the sake of the staff that it doesn't).

baby_boomer

Ouch!

""B&B tops the risk list [in terms of pension liabilities] with an equity holding in its fund equivalent to 75 per cent of market capitalisation, and a liability equivalent to 125 per cent of its market capitalisation."

The markets on Monday could make quite a difference to any interest in buying the people in the business :eek:

However the Indy is naughty in its reporting. Much more significant would be the % of the liability actually funded, rather than a comparison to the collapsed share price.

Generali

baby_boomer wrote: »

Ouch!

""B&B tops the risk list [in terms of pension liabilities] with an equity holding in its fund equivalent to 75 per cent of market capitalisation, and a liability equivalent to 125 per cent of its market capitalisation."

The markets on Monday could make quite a difference to any interest in buying the people in the business :eek:

However the Indy is naughty in its reporting. Much more significant would be the % of the liability actually funded, rather than a comparison to the collapsed share price.

I see! What a stupid way to put it.

They're comparing assets and liabilities in the pension fund to the market cap. of the company. That looks to me like there is a pretty chunky deficit. That's another liability we'll be taking on. Not that it'll be appearing on the national debt of course.

baby_boomer

Generali wrote: »

What a stupid way to put it.

Thanks for that.

If B&B's shares are worth £0,as I'd expect, it'd be nice for the taxpayer to know the sums in £s rather than as a % of £0.

The 2007 B&B accounts have the deficit as only £22 million for a combination of the pension liabilities and medical care liabilities. The total liabilities were just under £600 million.

When the account were produced the FTSE was about the same level as Friday's close. So B&B may be at risk, because all pension funds carry risk, but the Independent report clearlyexaggerated the scale of the pension problem IMHO.

Do you agree, Generali?

Generali wrote: »

Shall we play a game children? Let's try to get through a thread .....without gratuitous insults

Generali

baby_boomer wrote: »

If B&B's shares are worth £0,as I'd expect, it'd be nice for the taxpayer to know the sums in £s rather than as a % of £0.

Using A' Level maths I guess that as B&B shares tend to £0 in value, the liability tends to an infinite number of per cent. I don't think that's particularly helpful myself.

BettiePage

http://forums.moneysavingexpert.com/showthread.html?t=1184281

From the grabbit board.

wymondham

Will this mean real problems with any buy-to-let mortgage holders who wish to remortgage? - who would they go to as I've read B&B were the main players?

mewbie_2

wymondham wrote: »

Will this mean real problems with any buy-to-let mortgage holders who wish to remortgage? - who would they go to as I've read B&B were the main players?

They'll be all right - they'll just buy more. Oh.. Er.

WTF?_2

mewbie wrote: »

They'll be all right - they'll just buy more. Oh.. Er.

With the recent house price drops (circa 10% in a year), this is a perfect chance to increase their portfolio!

Boy, the taxpayer is going to make a killing with all the new BTL mortgages it can sell through B&B/NR :rotfl:

Generali

baby_boomer wrote: »

Thanks for that.

I meant the Independant not you! On reflection it doesn't read that well - I should have been clearer. I was trying to agree with you!

baby_boomer wrote: »

If B&B's shares are worth £0,as I'd expect, it'd be nice for the taxpayer to know the sums in £s rather than as a % of £0.

The 2007 B&B accounts have the deficit as only £22 million for a combination of the pension liabilities and medical care liabilities. The total liabilities were just under £600 million.

When the account were produced the FTSE was about the same level as Friday's close. So B&B may be at risk, because all pension funds carry risk, but the Independent report clearlyexaggerated the scale of the pension problem IMHO.

Do you agree, Generali?

So it looks like the liability for the fund was £22,000,000 for medical and pension as of 2007. Not the end of the fiscal world.

I agree absolutely and please accept my humblest apologies for being (unintentionally) rude.