B&B goes for third time lucky in rights issue

Jul 18 2008 by Peter McCusker, The Journal

SHAREHOLDERS in beleaguered buy-to-let lender Bradford & Bingley have agreed to allow the firm to go ahead with its third attempt at a balance sheet boost.

Just over 50 investors gathered for the meeting at Sheffield Arena, called after two previous fundraising schemes collapsed. Chairman Rod Kent told the investors present: “If we keep our heads, we will get through it.”

The meeting to decide whether the £400m rights issue should go ahead comes as B&B’s battered shares remain below the 55p price being offered to investors under the scheme.

In his opening address, Mr Kent told the investors dotted around the cavernous hall that mortgage lending was a cyclical business which involved a two-year downturn every decade.

He said: “This is such a downturn.

“It will pass and if we keep our heads we will get through this.

“The process of raising capital has not been a smooth or an easy one. We completely understand that this has not been a comfortable process for our shareholders, our customers and our employees.”

Answering questions, he said he did not think executives would be getting any bonuses this year and confirmed his remuneration package did not include a bonus scheme.