Major shareholders line up behind B&B rights issue
by Gill Montia
Story link: Major shareholders line up behind B&B rights issue
Bradford & Bingley’s (B&B) leading shareholders have lined up behind its £400 million rights issue for fear of the repercussions that could result for the UK financial sector should the lender collapse.
The discounted price of the rights issue is 55p but B&B’s shares fell to 34p yesterday, trading almost 90% below their July 2007 level.
According to a report in The Times, Legal & General and Standard Life will both subscribe to the rights issue to the tune of £50 million each, regardless of whether the bank’s shares are trading below the issue price.
Meanwhile, M&G and Insight Investment are committed to a further investment of £25 million each.
HSBC, Lloyds TSB, HBOS, Barclays, Royal Bank of Scotland and Abbey, which are sub-underwriters of the fundraising have guaranteed to subscribe a further £150 million in total.
The High Street banks will take up a proportion of any shares left with UBS and Citigroup, which are underwriting the rights issue.
Bradford and Bingley is Britain’s largest buy-to-let mortgage lender.
In the four months to the end of April, it posted a pre-tax loss of £8 million, compared with pre-tax profit of £107 million in the same period of 2007.
At that time, the bank reported that its level of arrears had risen from 1.63% to 2.16% and that it expected the trend to continue.
Add to Bookmarks:
Related stories to: Major shareholders line up behind B&B rights issue
B&B shareholders launch legal action over rights issue ... Barclays refuse to rule out rights issue ...
RBS considers sale of Direct Line and Churchill ...
Shareholders approve HBOS rights issue ...
RBS £12bn rights issue 95% subscribed ...
No Comments »No comments yet.
Leave a commentPrevious: « Calyon appoints new Americas deputy CEO
Next: Fortis sell IAM to management »
Visited 1613 times, 2 so far today