Bradford and Bingley Shares

Bradford & Bingley shares

Alastair Darling, Chancellor of the Exchequer has anounced that Bradford & Bingley is to be nationalised. As such, the government will take over the running of the bank’s mortgages. Meanwhile Santander (owners of Abbey) will take over other parts of the business. Branches and the internet business have been transferred to Abbey and depoistors and account holders can operate their accounts as normal. There is no need to withdraw funds from Bradford & Bingley. The Bradford & Bingley name will continue for the time being.

It is only the mortgage business and the headquarters that have been taken into public ownership.

Bradford and Bingley Building Society converted to a plc in December 2000. Qualifying participants were able to claim shares in the newly created company. As part of the demutualisation of Bradford & Bingley Building Society and pursuant to the terms of the Transfer Agreement, Bradford & Bingley plc sold all remaining unclaimed shares in March 2004

Shares
With a panic in the stock market following the Northern Rock collapse, shares fell by over 15% to 279p. Subsequent falls and an £8 million loss in the first few months of 2008 led to further significant falls at the beginning of June with shares down to just 67p. Chancellor Alastair Darling stressed that depositors money is safe and that restructuring and a rights issue would see the bank through any problems.

However further turbulence in the market has meant that the government needed to take action.

Bradford & Bingley shares started off at 280p and reached between 440p and 480p until the recent problems in the banking sector. The share price fell to as low as 20p on the friday before “nationalization”. It is unlikely that shareholders will receive anything for their shares although it is likely that the Government will set up an independant valuer. Trading in shares has been suspended and it is not possible to buy or sell shares.

Particularly hard hit will be employees with shares. Not only is there a risk to their jobs, but their savings in the form of shares in their employer, have become almost worthless.