Bradford and Bingley - Treasury to intervene

rickbonar

I was thinking about putting savings offshore actually but with them now taking witholding tax at 20% going up to 35% in 2011 it's not going to be any point. Seriously... I expect the channel island and european banks including Switzerland, Luxembourg etc to collapse when investors move their money out to banks "beyond EU jurisdiction" ( canoe mans Judge quote) centres like Panama and Belize.

edwinac_2

UK government poised to nationalise B&B

By Jane Croft and Kate Burgess in London and George Parker in Birmingham
Published: September 26 2008 22:44 | Last updated: September 29 2008 01:37

The government was on Sunday night preparing to nationalise Bradford & Bingley after hammering out a deal with the Spanish bank Santander, which will buy the embattled UK mortgage lender’s £21bn deposit book and branch network for about £600m.

The bank is set to be taken into public ownership on Monday after B&B saw retail savers withdraw “tens of millions of pounds” in recent days as uncertainty grew.

On Saturday, the government invited bids for B&B’s £21bn retail deposit base and branches as well as inviting offers for its head office and its mortgage loan book.

After 12 hours of talks, Santander last night agreed to buy the network of 197 branches and 140 agency outlets as well as the retail deposits.

Santander will immediately be able to recoup £200m of capital that supports the branch network, and so it is actually paying closer to £400m. A statement is expected before markets open on Monday at 7am.

If completed, the deal would see Santander, which already owns Abbey and is taking over Alliance & Leicester, holding 1,200 branches in the UK. It will also be able to add £21bn of retail deposits to its existing £68bn of retail savings.

B&B branches will open as usual on Monday and will remain branded as B&B for the foreseeable future.The government is expected to nationalise B&B’s £42bn mortgage loan book, which consists of risky buy-to-let and self-certified mortgages with rising arrears.

It will also control the bank’s Yorkshire head office which employs 1,400 people, and its mortgage processing operation.

[..]

Chancellor Alistair Darling has made clear he will stand behind B&B depositors, but there are other creditors who could be put on risk, rather than leaving taxpayers to shoulder that burden.

One option is to bundle B&B’s mortgage business with Northern Rock to create a nationalised super bank, although that is described as “a second order” issue and no decision is expected imminently.

[..]

The moves last night triggered concern from Peter Montagnon, director of investment affairs at the Association of British Insurers, representing the bank’s biggest investors. He pinpointed concerns that a bank with an apparently strong capital ratio should be on the brink of failing.

Andrew64

Bradford & Bingley will be merged with Abbey National:

http://news.sky.com/skynews/Home/Business/Abbey-To-Take-Over-Bradford--Bingley-Retail-Deposits-And-Branch-Network/Article/200809415108888?lpos=Business_Carousel_Region_0&lid=ARTICLE_15108888_Abbey_To_Take_Over_Bradford__Bingley_Retail_Deposits_And_Branch_Network

rchddap1

Quick question. Our contents is with B&B....does anyone know how or if that will be affected?

bubblesbonbon

rchddap1 wrote: »

Quick question. Our contents is with B&B....does anyone know how or if that will be affected?

I believe that B&B sold home insurance that was underwritten by Zurich and if so then it should not be a problem.

Incidentally, The B&B homepage is now sporting a "business as usual" message

http://www.bradford-bingley.co.uk/index.asp

bristolleedsfan

rickbonar wrote: »

even they sold us more as a "rights issue", (no doubt for speculators again to make a quick buck on) ... I'm £185 lighter.

quote]


Without being unkind, you bought into B+B rights issue not because you had a love for B+B, you gambled that B+B share price would rise above the rights issue price and make a profit for yourself at some point in the future, effectively you were a speculator, the gamble merely backfired.

Stavros_3

This is taken from this is money site, is this right?, How can they gurantee 100% of deposits if its being sold to Santander Quote :-


Yvette Cooper, Chief Secretary to the Treasury, yesterday broke the Government's silence to reassure B&B's 2.5m savers that their deposits will be properly protected. As with Northern Rock, the Government is expected to guarantee every penny of savers' cash, rather than just the £35,000 official limit.

Andrew64

If the government doesn't have your deposit - Santander will - how can it give 100% guarantee? Surely only the 35k rule applies.

bristolleedsfan

http://www.citywire.co.uk/personal/-/news/markets-companies-and-funds/content.aspx?ID=315645&re=3829&ea=187011

napoleon

Andrew64 wrote: »

If the government doesn't have your deposit - Santander will - how can it give 100% guarantee? Surely only the 35k rule applies.

Please pay attention. Haven't you been watching?

The government will step in and save the day yet again if required