Bradford & Bingley - Last Updated 10 January 2010

We have received many complaints from shareholders about the nationalisation of Bradford & Bingley. Many shareholders feel particularly disgruntled because they subscribed to the rights issue only a few weeks before, which was promoted to them as putting the company on a sound financial footing for many months. The UK Shareholders Association has formed a Shareholder Action Group to represent the interests of shareholders in this company.

The key questions which shareholders need answers to are:

1. The exact reason for the nationalisation of the company and the necessity to confiscate the property of the ordinary shareholders (as the owners of the business). 

2. Whether the rights issues should have been permitted to proceed and whether shareholders were wrongly induced to subscribe to it, when it seems that this fund raising was insufficient to stabilize the company so that only a few weeks later the Government found it necessary to intervene. 

3. Whether the comments concerning the strength of the company, only a few days before nationalisation took place, from the directors and from the investors relations department were misleading. 

4. The question of what compensation, if any, shareholders will get from the Government and on what basis that will be determined.

Go to the following page for more explanation of the above issues and a summary of the views of UKSA on the nationalisation and what issues shareholders might pursue: B&B Summary. Please read it if this is your first visit to this web page.

If you wish to register your interest in this company and our campaign then please contact the following: Deborah Newman, Administration Secretary, UKSA, email: uksa1@btconnect.com, telephone: 020-8468-1027, UK Shareholders Association, Chislehurst Business Centre, 1 Bromley Lane, Chislehurst, BR7 6LH. Although none of the following is essential (other than a name) it would help to provide the following information: Name, Email address, Telephone number, Postal address and Number of shares held.  Any such information will be held in confidence by UKSA and will be used to communicate with you to provide further information as it becomes available. Please make sure you mention "Bradford & Bingley" in the title of your email.

Note that it may take several days to acknowledge your email due to the volume of inquiries we are getting on this subject. Please send an email rather than try to telephone us for the same reason.

For general inquiries on this campaign contact: David Blundell, Chairman, Bradford & Bingley Shareholders Action Group (email: dwwb@btinternet.com ).

The following is what we have previously said about the company (latest comments at the bottom):

In April 2008, Bradford & Bingley Plc issued an announcement that stated they were not intending to have a rights issue following rumours being published in the press. But only a few weeks later they announced one. In addition, after the terms of the rights issued were published, they decided to revise the issue so that it was at a deeper discount and included the sale of a substantial proportion of the company to TPG.

On the 4th June, UKSA wrote this letter to the FSA calling for an investigation into the affairs of the company:FSA_Letter_B&B

Note that UKSA did not believe the revised terms of the rights issue were beneficial to private shareholders as claimed and suggested that shareholders might consider voting against it. The Association of British Insurers (ABI) expressed concerns about the sale of a large stake in the company to TPG as part of the new deal. Peter Montagnon, director of investment affairs at the ABI, said: “On the surface this is a pretty serious breach of the pre-emption rights principle." Pre-emption rules basically give existing shareholders a first call on any new share issues.

On the 5th June the media reported that the FSA was investigating potential insider trading in the shares of Bradford & Bingley prior to the profits warning due to the abnormal price movements in the few days beforehand.

UKSA issued the following press release on the 16th June concerning the question of whether shareholders should vote in favour of the rights issue: Press063 and taking into account subsequent events, we issued the following note on the 30th June: Press064 .

Soon after that press release was issued, TPG withdrew from the deal claiming downgrades to the credit rating of B&B as the reason, and within a matter of hours a third rights issue was proposed. We then issued the following press release supporting this proposal: Press066 .

UKSA issued the following press release on the 28th September following press reports of the imminent "nationalisation" of Bradford & Bingley: Press068. On the following morning the Government announced that the company had been nationalised under the same Act used to nationalise Northern Rock and the retail deposit base and branch network had been sold to Santander (Abbey) funded by about £20bn from the Government and the Financial Services Compensation Scheme (FSCS). The latter will get a loan from the Government which will be repaid out of the other assets of the company. The B&B mortgage book and other assets will be retained by the Government and effectively wound up. Any compensation payable to shareholders will be determined by a "Compensation Order" to be put in place in due course.

The following note was issued on the 5th October and contains a summary of the views of UKSA on the nationalisation and what issues shareholders might pursue: Update_1 . This note was issued on the 15th October to advise supporters of the status of this campaign: Update_2 . The following note was issued on the 30th October concerning a letter that some shareholders have received from a firm of solicitors and other news: Update_3

On the 10th November we sent the following letter to the Chancellor of the Exchequer with the purpose of trying to get some answers to the key questions on the nationalisation of Bradford & Bingley and commenting on the possible compensation arrangements for shareholders: Darling_Letter_Nov2008. This note was issued soon after covering that and the recent House of Commons Treasury Committee meeting: Update_4.

The formal launch of the Bradford & Bingley Shareholder Action Group was announced in this press release on the 17th November: Press072 . Soon after we also issued this press release on the Subordinated Bonds (formerly called PIBS): Press073 . On the 22nd November we issued this note which covers the events prior to nationalisation and other revelations from the Treasury Committee: Update_5

We are suggesting that supporters write to their M.P.s using the following letter as a template: B&B_MPs_Letter so that we can get some answers on the key questions for shareholders. This and other news was covered in this note: Update_6

On the 11th December the Compensation Order for Bradford & Bingley shareholders was published by the Government - see www.opsi.gov.uk/si/si2008/draft/ukdsi_9780111471180_en_1 . Unlike that for Northern Rock, no artificial assumptions are placed on the valuation process and terms of reference. More comments on this are given in this note: Update_7.

On the 27th December, UKSA called for a public inquiry into the affairs of Bradford & Bingley, and repeated its request for information on why the company was nationalised, in this letter to the Chancellor of the Exchequer: Darling_Letter_Dec2008 . On the 31st December we issued this note about the debate on the Compensation Order and other recent news: Update_8

A note on the valuation of Bradford & Bingley was published on the 26th January 2009 in this file: B&B_Valuation. It makes it clear that in our view the company had significant value at the nationalisation date, and gives some rough guidance as to what that might be. This was distributed to our supporters together with other news in this note: Update_9

MEETING FOR SHAREHOLDERS. A meeting to answer the questions of shareholders was fixed for the 7th March in Bingley, Yorkshire. Details of this meeting and other news is in this note: Update_10 . On the 3rd March we issued this press release Press_Mar2009, and this note to shareholders: Update_11. A report on the Public Meeting for shareholders and other news was issued in this note: Update_12.

The page of this web site dedicated to the Subordinated Bondholders (PIBs) was revised on 29/3/2009 and a letter template for use when writing to your MP was added - see Bonds . A note on the current objectives for this campaign, and the B&B accounts for 2008 was issued in this document on the 14th April: Update_13

BOND DEFAULT. On the 28th May we issued this note on the cessation of interest payments on the subordinated bonds (PIBS): Update_14

LETTER TO PRIME MINISTER. On the 9th June, we sent this "open" letter to Prime Minister Gordon Brown: Brown_Letter_June2009

VALUER APPPOINTED AND SHAREHOLDER MEETING. We issued this note after the announcement of the appointment of an independent valuer for the determination of compensation payable to shareholders: Update_15. It also announced a meeting for shareholders on the 10th October in London.

EARLY DAY MOTION. A press release was issued concerning the submission of an Early Day Motion in the House of Commons by John Thurso MP: Press_Jul2009 at the end of July. This and other news was covered in: Update_16

MEETING ON THE 10TH OCTOBER. This note was issued on the 8th September about the forthcoming meeting for shareholders on the 10th October: Update_17 (see this page also for meeting details: BB_Meeting). A final note to remind people of the meeting and giving more details was issued in this document: Update_18

MEETING REPORT. A brief report on the meeting for shareholders held in London, plus some photographs, is present on this web page: BB_Meeting). This was also included in this newsletter to supporters: Update_19

ACTION GROUP COMMITTEE TO MAKE SUBMISSION TO PWC IN RESPECT OF THE VALUATION PROGRESS. This follows several meetings between David Blundell, Chairman of the action group, and Peter Clokey of PWC.  The following newsletter :  Update_20 was added to the site in January 2010.