Bradford and Bingley CEO does a runner

epz_2

looks like we are going to soon own another bank boys and girls as the UKs largest BTL lender retires due to "health issues" before a rights issue.

WTF?_2

epz wrote: »

looks like we are going to soon own another bank boys and girls as the UKs largest BTL lender retires due to "health issues" before a rights issue.

I reckon that this time around there will be a 'behind closed doors' deal done to bail them out. Wouldn't do to panic the public by telling them that tens of millions of their taxpayer pounds are going into rescuing another financial enterprise that couldn't keep its business viable after it succumbed to greed and risky lending.

One of the most notable thing about B&B (other than its status as borrower of choice for BTL) was that it was one of the first to do >100% LTV mortgages:

http://goliath.ecnext.com/coms2/gi_0199-839465/Bradford-broaches-100-LTV-barrier.html


Mind you, they weren't the only big names to loan more than 100% of the value of a house. They are in the distinguished company of people like Northern Rock, Brimingham & Midshires and Alliance & Leicester during "The great property insanity"......

http://www.mortgageintroducer.com/ccstory/20038/5/Giving_it_100_per_cent.htm

Ray Boulger of broker John Charcol says more competition in the 100 per cent plus market is welcomed by brokers. “Some good aspects of the PlusMortgage criteria include no unreasonable restrictions on how the unsecured loan element can be used, a valuation fee refund on most products and good indicative income multiples of around five times single or joint for most borrowers,” he says.

Just think how mad all this is going to look to economic historians a decade or two down the line. :cool:

MissMoneypenny

!!!!!!? wrote: »

I reckon that this time around there will be a 'behind closed doors' deal done to bail them out.

I guess we will just have to watch for them making their remortgage rates unattractive, to make their borrowers go elsewhere.

codger

I'm not sure the CEO has done a runner, TBH.

It looks like a case of a genuine illness being accurately diagnosed in time.

This is, of course, entirely different to the delusory affliction brought on by corporate greed which struck B&B and many another major institution but is only now about to be treated.

I'm not sure if the state of the CEO's health will merit an update but that of B&B's will certainly make interesting reading tomorrow (Monday) . . .

. . . Well, it will to all those who, like this Government, its Prime Minister, and the Bank of England, have spent so many years never once looking at the patient's notes.

WTF?_2

I have a feeling that he might make a miraculous Ernst Saunders style recovery.....

http://en.wikipedia.org/wiki/Ernest_Saunders

Delmonte_3

!!!!!!? wrote: »

I reckon that this time around there will be a 'behind closed doors' deal done to bail them out. Wouldn't do to panic the public by telling them that tens of thousands of millions (aka 'billions')of their taxpayer pounds are going into rescuing another financial enterprise that couldn't keep its business viable after it succumbed to greed and risky lending.

I fixed your typo

I agree that the taxpayer won't be game for more bailouts. I don't recall being too chuffed at throwing £50bil at Northern Rock.

meanmachine_2

!!!!!!? wrote: »

Ray Boulger of broker John Charcol says more competition in the 100 per cent plus market is welcomed by brokers. “Some good aspects of the PlusMortgage criteria include no unreasonable restrictions on how the unsecured loan element can be used, a valuation fee refund on most products and good indicative income multiples of around five times single or joint for most borrowers,” he says.

Just think how mad all this is going to look to economic historians a decade or two down the line. :cool:

Thought it mad at the time and think it utterly obscene today.

People like Boulger should be brought to account for making such comments during the boom years.

And the people behind these 100%+ mortgages should be thrown into the equivalent of a debtors' prison.

Jesus had the right idea - moneylenders are a wicked bunch.

brit1234

It looks like B&B won't last the month. The rights issue will throw good money after bad if anyone is stupid to participate.

If anyone has over £30,000 in B&B you better move it out quick.:exclamati

m00m00

top story on the bbc news, B&B to get 400 million cash injection

not from gordon brown for a change

http://www.bbc.co.uk/blogs/thereporters/robertpeston/

MarkyMarkD

The rights issue is fully underwritten, so B&B will get the money. I don't see on what grounds you suggest they "won't last the month".

This bit:

The lenders' profits have been hit by a rise in the number of its borrowers who are experiencing difficulties making repayments on mortgages.

A further squeeze on profits has come from a narrowing in the gap between the interest rate it pays for funds and the rate it receives from borrowers.

is absolutely the wrong way around. The credit crunch's impact is all about interest margins - basically, cost of borrowing for banks has increased tremendously. Bad debt losses are trivial compared to this.

codger

!!!!!!? wrote: »

I have a feeling that he might make a miraculous Ernst Saunders style recovery.....

http://en.wikipedia.org/wiki/Ernest_Saunders

Tst, tst, !!!!!!

It's well known that ol' Ernest is living proof of the worthiness of his product (Guinness Is Good For You.)

Where B&B's restorative powers are concerned, I fear its CEO will have no such luck, seeing as how his condition has been described as cardio-vascular.

On which note, the untreated presence for so long of so many potentially lethal clots in the circulatory system of the UK economy is a signally uncanny coincidence.