Bradford & Bingley are DOOMED !

RichardDJ

I do hope panic does not set in again, not so sure about the statement of responsible reporting by the media though - it was ol porky boy's biggest story this morning

TTMCMschine

It is exactly like another Northern Rock - they haven't the funds to conduct business. I heard some guff on the tv this morning that made me laugh - the reporter was saying they were fine for "normal" money to run the business, this was just a kind of cushion (bit like a rainy day fund I suppose) that banks like to have, they didn't need it, they just like to have it was the jist - well call me cynical, but when a company listed on the stock exchange does x, y, & z & it causes the share price to drop by 95%+ then there'd better be a much better reason for it than "they like to have a cushion but don't need it."

Companies don't lose 95%+ of their value for nothing.

Treadmill

nobodys rushing to B&B to get out savings as far as I could see just now in town, maybe the problem is that not enough people actually save with them

TTMCMschine

Could be, they all just have mortgages there?

Generali

poppysarah wrote: »

What do private equity firms do?
Sell off the good bits, sack staff?

That sort of thing.

The idea these days is generally:

1. Close down the hopeless stuff
2. Sell off the not so good stuff
3. Invest in the rest to make it into a good on-going business and sell it.

WTF?_2

TTMCMschine wrote: »

It is exactly like another Northern Rock - they haven't the funds to conduct business. I heard some guff on the tv this morning that made me laugh - the reporter was saying they were fine for "normal" money to run the business, this was just a kind of cushion (bit like a rainy day fund I suppose) that banks like to have, they didn't need it, they just like to have it was the jist - well call me cynical, but when a company listed on the stock exchange does x, y, & z & it causes the share price to drop by 95%+ then there'd better be a much better reason for it than "they like to have a cushion but don't need it."

Companies don't lose 95%+ of their value for nothing.

I remember all the guff we were fed from Darling and Brown about Northern Rock being a fundamentally sound business with a high quality loan book. Until the point where it was nationalised and costing us hundreds of billions in support at which point we got the truth about it having an unsound business strategy and needing to be bailed out.

As for the loan book, you can see how good that is by the fact that the new look NR are trying to get as many people off it as possible.

B&B isn't in exactly the same position but it's far from having a viable business strategy if they need to go back to the shareholders for more money and sell a chunk of equity in the business for cash.

tbs624

From the B&B guide to BTL mortgages:

“The first step is making your sums add up. It’s simple really………….a mistake here could cost you money later on. And that’s where we come in.”

* Now * I understand……;)

Anyone out there who has shares & is going to be taking up the invitation of “an offer they can’t refuse” ?

lostinrates

Texas Pacific are a pretty darn powerful group and although we moved our Bradford and Bingley account recently I have more faith now they are involved.

HelpWhereIcan

TTMCMschine wrote: »

I heard some guff on the tv this morning that made me laugh - the reporter was saying they were fine for "normal" money to run the business, this was just a kind of cushion (bit like a rainy day fund I suppose) that banks like to have, they didn't need it, they just like to have it was the jist - well call me cynical, but when a company listed on the stock exchange does x, y, & z & it causes the share price to drop by 95%+ then there'd better be a much better reason for it than "they like to have a cushion but don't need it."

Think maybe he was referring to the need to meet the Basel II requirements. http://en.wikipedia.org/wiki/Basel_II

The same reason Royal Bank of Scotland, HBoS, Cattles Group etc have share rights issues.

B&B have seen an increase in the number of mortgage accounts in arrears, have gone from a £100m plus profit to an £8m loss - they're also reasons the share price has really fallen

http://news.bbc.co.uk/1/hi/business/7430460.stm

Not in a great position, but still able to lend and not another Northern Rock.

A target for Barclays apparently.

minimike2

They are laying off mortgage advisers too.