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Shareholders rescue bank
Shareholders in Bradford & Bingley were unexpectedly required to bail out the bank as a rescue funding package fell away. Shareholders were recently sent letters regarding a previous rights issue only to see the offer withdrawn and fresh letters sent telling them a private equity company would be buying the shares instead but at a price well below that which could be generated by the shareholders themselves. Shareholders were not happy at the banks proposed sale to the private equity firm some of whom supported a counter attempt by Resolution, an investment group headed by the insurance entrepreneur Clive Cowdrey, who was refuesed access to the bank's books by the bank itself.
The £179 million, 23 per cent deal by TPG Capital was withdrawn once the ratings agency Moody's made it clear they would be downgrading the bank's rating to Baa 1, this was crucialy the banks second down grade in the past month and would be the lowest credit score of any big British bank.
B&B have may already have set a plan in motion which they had discussed with the FSA whereby £179 million was to be put up by shareholders with a further £400 million from a rights issue.
← Latest figures show it's cheaper to buy than rent | News For July 2008 | Government aims to help builders and buyers →
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Grovelawn Financial is a trading name of Grovelawn Limited, which is authorised and regulated by the Financial Services Authority.
Grovelawn Limited is Registered in England & Wales number 5030300. Registered Address: 98 Station Road, Sidcup, Kent, DA15 7BY.
Entered on the Financial Services Authority's Register — Register Number: 314204 — Consumer Credit Licence Number: 573287
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