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30-05-2008, 12:17 AM

Back to Bradford & Bingley. Closed down a further 7% today to 90.25. I wonder if the queues outside branches will start tomorrow...

31-05-2008, 05:24 AM

^Now at 88p, just 6p from the rights issue price, which is now bound to fail. UBS and Citi now have to split the £300M bill. Meanwhile, B&B will 'merge' with The Crock...

02-06-2008, 03:38 PM

As predicted:

SHARES SUSPENDED

http://www.londonstockexchange.com/LSECWS/IFSPages/MarketNewsPopup.aspx?id=1856932&source=RNS

TPG Capital (”TPG”), a leading global private investment firm, has agreed to invest approximately £179 million and become a major strategic investor owning 23% of the Company upon completion - A Restructured Rights Issue will raise approximately £258 million and, together with TPG’s investment, will raise additional capital of approximately £400 million, net of expenses. All shares will be issued at an offer price of 55 pence per share

- Difficult economic conditions have led to a decline in net interest margin and increasing arrears. Underlying profits for the first four months of the year amounted to £56 million compared to £108 million in 2007. The trading update highlights a more cautious outlook for the year

- Steven Crawshaw has stepped down as Group Chief Executive with immediate effect as a result of serious illness. Chairman Rod Kent has become Executive Chairman

(My comment): Crawhaw's illness appears to angina attacks, no wonder, as his bank goes bust!

Hope you all got your money out, I did give you about 3-months notice!

02-06-2008, 03:44 PM

Oh and don't be fooled by this latest 'bad money after good' 'investment'. The new rights issue price has been reset to 55p (from 82p, which was doomed to failure as the shares slid). Current share price after the shares began trading again is 64p - down over 27% on Friday's close!

21-06-2008, 04:58 AM

Feds arrest two former Bear Stearns hedge fund managers

by The Associated Press Thursday June 19, 2008, 8:19 AM

Federal authorities said two former Bear Stearns managers have surrendered in New York City to face criminal charges in the wake of the collapse of the subprime mortgage market.

Daniel Acker/Bloomberg NewsRalph Cioffi, former manager at Bear Stearns, is escorted by police officers to federal court in Brooklyn borough of New York today.

Authorities in Brooklyn are expected to give details later Thursday on the case against Ralph Cioffi, of Tenafly and Matthew Tanin, of Manhattan, who are ex-managers of Bear Stearns hedge funds that collapsed last year.

Officials told The Associated Press that the former executives are suspected of misleading investors about the risky subprime mortgage market. They have been the target of the yearlong probe.

Justin Lane/EPAMatthew Tannin, a former Bear Stearns hedge fund manager, is escorted by law enforcement officials after being arrested in New York today.
Tannin's attorney has declined to comment and Cioffi's attorney has not responded to a phone message.

Last month, Bear Stearns shareholders approved JPMorgan Chase's $2.2 billion buyout at about $10 a share. Back in January 2007, before mortgage defaults began clobbering banks and draining demand from the debt markets, Bear Stearns had traded at $171 a share.

Butterfly · 21-06-2008, 08:48 AM

not sure where we are heading with all this, hedge funds have always been "dodgy", not sure why the arrests now, they could have done it before the meltdown, frauds outside the subprime mess were already committed,

25-06-2008, 04:17 PM

I alluded to the fact that B&B were rescued to prevent GMAC going bust. Their troubles still, however, rumble on:

Quote:

GMAC's $60 Billion Deal Loses Traction as Cash Burns (Update1)

By Ari Levy and Caroline Salas

June 24 (Bloomberg) -- The 300 bankers gathered at New York's Waldorf-Astoria Hotel last month faced a stark choice: Accept Sam Ramsey's plea to restructure $60 billion of GMAC LLC's debt or risk pushing the lending arm of General Motors Corp., the largest U.S. automaker, to the brink of insolvency.

``There was not room for slippage,'' said Ramsey, 49, a former Bank of America Corp. executive who joined Detroit-based GMAC in September and became chief risk officer two months later. He pulled it off as banks led by New York-based JPMorgan Chase & Co. and Citigroup Inc. provided GMAC and its Residential Capital LLC mortgage unit with the biggest restructuring package since the credit-market rout began a year ago.

Whether that's enough to ride out the worst housing slump since the Great Depression remains in doubt. Moody's Investors Service cut GMAC's credit rating one level to six rankings below investment-grade last week as ResCap burns through cash after losing $5.3 billion in the past six quarters.

``ResCap presents a very significant risk,'' said Mark Wasden, the lead GMAC analyst at Moody's. ``There is no easy exit from their difficulties right now. We think the company will yet again find itself in need of additional cash.''
Credit-default swap prices give ResCap a 100 percent chance of default within the next five years, based on a JPMorgan model. It was 98 percent before the debt agreement was announced.

Bigger Than Bear

GMAC, started 89 years ago by GM, has 27,000 employees, twice the number that Bear Stearns Cos., the fifth-biggest U.S. securities firm, had when it was rescued in March by JPMorgan. GMAC's $250 billion in assets makes it bigger than Countrywide Financial Corp., the biggest U.S. mortgage company by loans, which is being bought by Bank of America. Investors had speculated that ripple effects from those potential failures could have spread to the rest of the U.S. financial system.

GMAC's latest rescue effort began May 2 at 6:30 a.m. New York time, when ResCap released a statement saying it would offer as little as 80 cents on the dollar to exchange or buy back $14 billion of bonds to delay maturities and reduce debt.

Shortly before 9 a.m., bankers filtered into the Waldorf's Starlight Roof on the 18th floor, where Guy Lombardo and his Royal Canadians once serenaded New Year's revelers. As attendees sipped coffee and munched pastries, JPMorgan Vice Chairman James Lee kicked off the event. Then it was the turn of GM Chief Operating Officer Fritz Henderson. Next was Stephen Feinberg, the founder of Cerberus Capital Management LP, who had been instrumental in leading the $7.4 billion purchase of 51 percent of GMAC in 2006.

Oozing Cash

Separated from the automaker, GMAC's credit rating was supposed to rise from junk, which would have lowered borrowing costs. Instead, the ResCap unit was hit by a cash crunch as subprime home loans started to default. The Minneapolis-based housing unit lost more than $4.3 billion last year, contributing to a $2.3 billion loss for GMAC. ResCap's subprime loans totaled $32.8 billion in March, compared with $36.8 billion at the end of 2007, according to a company filing.

The number of Americans in danger of losing their homes to foreclosure rose to the highest in at least three decades during the first quarter, according to data from the Washington-based Mortgage Bankers Association.

``It was when the problems started at ResCap that the GMAC ratings got pulled down,'' said Wasden, the Moody's analyst. ``You could see how, absent ResCap-related problems and some capital-building, they could march up in the speculative-grade ratings profile.''

Not Just Talk

After Feinberg spoke at the Waldorf meeting, it was Alvaro De Molina's turn. De Molina was an executive at Charlotte, North Carolina-based Bank of America until 2006 and was appointed GMAC's chief executive officer in March. Ramsey, a 25-year banking industry veteran, then finished up the morning session with a 20-minute talk.

``It was the first time some of the lenders had the opportunity to see that management did have a plan for continued success,'' said Chad Leat, chairman of Citigroup's Alternative Asset Group in New York, who attended the meeting and led Citigroup's underwriting of the loans. ``It was the first opportunity to hear and see the visible support, not only with words, but also with money from GM and Cerberus.''

Following a 10-minute lunch break, Ramsey, Leat and other executives broke into groups to take more specific questions. The central theme: Keep ResCap afloat long enough to take advantage of an eventual recovery in the housing market after more than 100 mortgage companies closed down, halted operations or sold themselves since the start of 2007. ResCap ranked eighth among U.S. home-lenders last year.

Sales Pitch

``If there was a sales pitch, it was a very simple one: This management team is turning this company around, ResCap specifically,'' Leat said. ``They have a plan and they are going to need liquidity to finance growth. And we're going to give you the following goodies in exchange.''

JPMorgan's Lee wrapped up the day at about 3 p.m. Over the next month, with GMAC's future hanging in the balance, Ramsey, de Molina, Lee, Leat and Feinberg hit the phones to make certain the banks understood the terms.

On June 4, GMAC replaced $6 billion of unsecured revolving credit lines, half of which were scheduled to mature this month, with an $11.4 billion secured revolving credit line that matures in three years. It also renewed a one-year $10 billion commercial paper agreement, and ResCap got a one-year extension on $11.6 billion of bank loans.

Citigroup Approves

``Put yourself in the shoes of some of the institutions who are raising capital to address their perceptions of deficiencies, facing markets that are not as liquid as they used to be,'' Ramsey said. ``This is the type of credit that in many cases has to go to the highest approval processes.''

As a lender, Citigroup liked the deal because it was able to swap unsecured commitments for secured ones, Leat said.

Citigroup, the biggest U.S. bank by assets, raised $44.1 billion of capital in the past year after reporting $42.9 billion of writedowns and credit losses from the collapse of the subprime market, data compiled by Bloomberg show. GM has been a client of Citigroup for more than 90 years, and Leat worked on the financing for Cerberus's GMAC purchase.

ResCap got a $3.5 billion two-year credit facility from GMAC, with the first $750 million guaranteed by Cerberus and GM. ResCap needed the loan to finance its bond tender offer, which lured investors holding about $9.5 billion of notes. Bondholders who exchanged their debt for longer-maturity securities are now senior to those who didn't and have a claim on the mortgage- lender's assets.

Hardest Deal

In addition to financing the bond exchange, GMAC and Cerberus agreed to pony up another $2.88 billion of funding for ResCap after the lender fell $2 billion short of meeting its debt obligations this month because it couldn't sell assets to raise cash.

``This was as hard and as complicated as anything I've done and I've been doing this around the clock for 17 years,'' said Timothy Pohl, co-head of the restructuring practice at Skadden, Arps, Slate, Meagher & Flom LLP in Chicago, which represented ResCap in the deal. ``There were a lot of legitimate concerns about whether it could possibly be accomplished.''

ResCap must still come up with enough cash to repay $3.5 billion of bonds and the $3.5 billion loan from GMAC in 2010. It may find GM and Cerberus unwilling to continue pouring money into it, according to Wasden at Moody's. ResCap has already returned for capital infusions at least three times in two years.

GMAC's $2 billion of 7.25 percent debt due in 2011 tumbled 5 cents today to 76 cents on the dollar, the lowest price since March according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. The notes yield 19 percent.

``This probably does buy them some time to continue to restructure and improve longer-term prospects,'' said Christopher Wolfe, an analyst at Fitch Ratings in New York, which reduced ResCap's debt to D from C after the deal, indicating default. ``It's still a very uncertain story.''

http://www.bloomberg.com/apps/news?pid=20601109&sid=aFREd.COhlF4&refer=home

29-06-2008, 02:38 AM

A great site: Watch banks GO BUST in real time:

http://bankimplode.com/

29-06-2008, 05:06 AM

CDO Defaults Reach $220 Billion on Deerfield Failure (Update1)

By Neil Unmack

June 27 (Bloomberg) -- Deerfield Capital Management LLC and Declaration Management & Research LLC pushed the amount of collateralized debt obligations in default to $220 billion, according to Wachovia Corp. analysts.

Downgrades to mortgage bonds and their underlying securities triggered so-called events of default on 200 CDOs since October, including Rosemont, Illinois-based Deerfield's Knollwood CDO Ltd. and Kent Funding II, managed by Declaration in McLean, Virginia, Wachovia analysts wrote yesterday. The total compares with 191 CDOs totaling $212 billion on May 21, according to the bank.

The failures are equivalent to 36 percent of CDOs that include U.S. asset-backed debt sold since 2003, and 19.3 percent of all CDOs, Charlotte, North Carolina-based Wachovia said. Losses on the securities that pool assets including subprime mortgages contributed to the almost $400 billion of credit losses and writedowns by banks worldwide in the past year.

CDOs repackage assets such as mortgage bonds and other debt into new securities that are then sliced into pieces with different ratings.

About $32 billion of the funds have been wound down or face liquidation. CDOs of asset-backed bonds typically have rules that may force them to sell holdings when ratings of the underlying assets are downgraded below a set level. The triggers, or events of default, allow creditors to liquidate the fund or divert money to repay senior debt at the expense of other investors.

Issuance of asset-backed CDOs has tumbled to less than $1 billion this year from $227 billion in 2007, according JPMorgan Chase & Co. data.

Mortgage-Bond Prices

Liquidations have helped push down prices on subprime and Alt-A mortgage bonds rated lower than AAA, UBS AG analysts wrote in a June 24 report. The expectation that more CDOs will be forced to sell mortgage assets has also contributed to price declines, the analysts said.

The unwinding of CDOs and so-called structured investment vehicles offers ``serious resistance'' to the recent rally among asset-backed bonds, Deutsche Bank AG said in a June 16 report. While older AAA rated subprime-mortgage securities are priced to a ``severe recession,'' the potential for more forced sales makes the debt risky, the report said.

From: http://www.bloomberg.com/apps/news?pid=20601087&sid=aqMZ6GS5sEcU&refer=home

03-07-2008, 05:43 AM

See the FT Alphaville blog today:

FT Alphaville » Blog Archive » Markets live transcript 2 Jul 2008

All going to sh1t. I'm going on holiday next week. Happy Days!

03-07-2008, 02:28 PM

IndyMac denies that it's close to collapse

Depositors have been pulling money from the Pasadena-based thrift, whose share price is down 90% this year.

By E. Scott Reckard and Andrea Chang, Los Angeles Times Staff Writers

Battling rumors that it may collapse, Pasadena-based IndyMac Bancorp acknowledged Monday that its financial position had deteriorated but described the fears as overblown and said it was working with regulators to improve its "safety and soundness."

IndyMac, a national home lender burned by the mortgage meltdown, went public after depositors lined up at San Gabriel Valley branches starting Friday to pull out their money. Striving to reassure them, the thrift said nearly all their deposits were insured by the Federal Deposit Insurance Corp.

Nonetheless, Elizabeth Brown closed four accounts totaling $200,000 Monday at an Arcadia branch where about 20 customers were lined up at noon, saying: "The only reason I'm panicking is if anything happens, my money is tied up.

Continued at:

IndyMac denies that it's close to collapse - Los Angeles Times

03-07-2008, 02:37 PM

No Loans at Mountain 1st Means Bank Credit Drying Up (Update2)

By Mark Pittman

July 2 (Bloomberg) -- Mountain 1st Bank & Trust Co. Chief Executive Officer Greg Gibson forecast 12 percent loan growth for his North Carolina bank this year. Instead, he's spending more time handing out freshly baked cookies than extending credit.

Gibson is ``standing on the brakes'' because Mountain 1st, owned by 1st Financial Services Corp. of Hendersonville, North Carolina, can no longer sell trust-preferred stock to raise capital for loans so customers can buy airplanes or build veterinary clinics, Gibson said in a June 20 telephone interview. The bank, with $650 million in assets, is among more than 8,000 across the U.S. caught for the past six months in the shutdown of the $117 billion market for the securities, a hybrid of debt and equity.

The fallout from the subprime-mortgage collapse is spreading from global lenders such as Citigroup Inc. and UBS AG to local ones, including Lansing, Michigan-based Capitol Bancorp, FirsTier Corp. of Northglenn, Colo. and Mountain 1st, which tempts customers at log cabin-style branches with cookies and coffee. Less capital for such hometown banks may stymie Federal Reserve Chairman Ben Bernanke's effort to prevent a credit crunch.

``There is no question there is a problem,'' said Chris Cole, senior regulatory counsel for the Independent Community Bankers of America, a Washington-based trade group for about 5,000 lenders. ``Banks need the capital to lend. So that problem of raising capital causes a further slowdown. This inability to raise capital points to a damping of the whole economy.''

10-Fold Growth

So-called community banks and larger lenders have sold trust-preferred securities, known as TruPS, for about a dozen years. Collateralized debt obligations became the biggest buyers, generating enough demand to expand the market 10-fold, according to Merrill Lynch & Co. index data. The CDOs packaged the shares and sliced them into pieces with varying credit ratings.

Community banks such as FirsTier were too small to attract insurance companies or mutual funds and sold the securities to CDOs instead, in issues of $10 million or $20 million at a time, according to Fitch Ratings analyst Nathan Flanders.

The market was upended after mortgage foreclosures reached a record high of 2.47 percent for all loans in the U.S., starting a credit-market meltdown that sent investors fleeing to safer government securities.

As the preferred market seized up, the Standard & Poor's Small Cap Regional Banks Index has fallen 34 percent this year, leaving banks unable to sell common stock without diluting existing shareholders. Cut off from fresh capital, some lenders may file for bankruptcy, according to ICBA's Cole.

Continued here:

Bloomberg.com: Exclusive

Butterfly · 03-07-2008, 03:13 PM

Bank run is never good news,

but most are local state banks, so not really national disaster, actually it is contained,

nothing to see, next

03-07-2008, 03:25 PM

^Unless you have an account with them....

Butterfly · 03-07-2008, 03:33 PM

^ FDIC ? ever heard of them ?

03-07-2008, 03:36 PM

^Indeed. I am sure that is something that all people ache to do every day as a leisure activity, file an FDIC claim.

04-07-2008, 02:05 PM

So, as predicted, B&B (the UK's largest Buy-to-Let) lender has been snubbed by TPG (despite the fact they were being bribed by the FED to keep GMAC afloat, as B&B are contraced to buy $4BN worth of mortgages per year). The books really are that bad.

The FSA has to step in, hats passed to taxpayer (again, ala Northern Crock) and Britain's reputation for financial competance sinks to the lowest level, well to a level slightly higher than it will be when HBOS sinks soon...

From Bloomberg:

BB:IX
Bradford & Bingley PLC

Related Company News

BG Group, Bradford & Bingley: U.K., Irish Equity Preview
July 3, 2008 22:02 EDT -- The following is a list of companies whose shares may have unusual price changes in U.K. and Irish markets today. Stock symbols are in parentheses, and prices are from the last market close.

B&B Enlarges Rights Offer as TPG Exits Investment (Update2)
July 3, 2008 21:38 EDT -- Bradford & Bingley Plc, Britain's largest lender to landlords, said it continues to be ``well funded'' even as TPG Inc. dropped plans to inject 179 million pounds ($354.7 million) after Moody's Investors Service said it would cut the Group's debt ratings by two levels.

TPG Abandons B&B Deal; U.K. Investors to Inject Cash, BBC Says
July 3, 2008 18:55 EDT -- Financial institutions in London are rallying to bolster Bradford & Bingley Plc after U.S. leveraged buyout firm TPG Inc. dropped plans to provide 179 million pounds ($354.8 million) in funding, the British Broadcasting Corp. reported, without saying where it obtained the information.

Stoxx 600 Stocks With Highest, Lowest Average Analyst Rating
July 3, 2008 13:04 EDT -- The following tables show the highest and Lowest average analyst ratings for stocks in the Dow Jones Stoxx 600 Index as of July 3.

TPG Is Entitled to Drop Bradford & Bingley Investment, FT Says
July 2, 2008 01:38 EDT -- TPG Inc., the U.S. leveraged buyout firm, can abandon its 179 million-pound ($353 million) investment in Bradford & Bingley Plc if the British mortgage lender's credit rating declines further, the Financial Times reported, citing the prospectus for B&B's rights offer.

Bloomberg.com: Investment Tools

05-07-2008, 05:52 AM

Bradford & Bingley Investors on the Hook as TPG Walks (Update2)

By Poppy Trowbridge and Jon Menon

July 4 (Bloomberg) -- Bradford & Bingley Plc's largest shareholders agreed to lead a bailout of the U.K. mortgage lender after TPG Inc. abandoned plans to buy a 23 percent stake.

Bradford & Bingley was forced to boost a proposed share sale to 400 million pounds ($738 million) after Moody's Investors Service cut its credit rating, giving the bank the lowest ranking in the U.K. and prompting U.S. buyout firm TPG to pull its planned investment. Investors Legal & General Group Plc and Standard Life Plc said they will buy new stock after it fell 18 percent today.

TPG's pullout is the latest setback for Chairman Rod Kent, who faces the worst property slump since the 1990s and calls to resign. A surge in late mortgage payments forced the Bingley, England-based bank to slash the price of its rights offering in June and reverse earlier assurances that it didn't need new capital.

``Bradford & Bingley has been lurching from one disaster to another,'' said Leigh Goodwin, an analyst at Fox-Pitt, Kelton Ltd. in London who has an ``underperform'' rating on the stock. ``The key question is whether this is Northern Rock in slow motion, and that seems to be speeding up.''

The U.K. nationalized Northern Rock Plc in February after it ran out of funds amid the credit crunch and triggered the first run on a British bank in more than a century. Britain's Financial Services Authority, which acknowledged it didn't properly oversee Northern Rock, said it's working with Bradford & Bingley and its underwriters on the rescue plan.

`All the Players'

``We're talking to all the players involved,'' FSA spokesman Joseph Eyre said today.

The Bingley, England-based bank will offer 828 million shares, or 67 new shares for every 50 existing shares, it said in a separate Regulatory News Service statement today.

The bank fell to 50 pence, the lowest since it sold shares in December 2000. That's 5 pence below the rights- offering price, valuing the bank at 309 million pounds. The shares are down 81 percent this year, making it the worst performer in the Bloomberg Europe Banks and Financial-Services Index.

Alliance & Leicester Plc, a mortgage lender based in Leicester, England, fell 12 percent to 255.5 pence. HBOS Plc, the U.K.'s largest mortgage lender, fell 2.8 percent to 271.5 pence, below the strike price for its planned 4 billion-pound rights offering to raise new capital.

Financial firms worldwide have raised 321 billion of new capital after posting more than $400 billion in losses and writedowns since the credit-market meltdown began last year.

Fort Worth, Texas-based TPG exercised a clause to withdraw its offer of 179 million pounds for a stake in Bradford & Bingley after Moody's cut Bradford & Bingley debt rating to Baa1 from A3 and cited a ``substantial deterioration'' in asset quality.

Bad Omen

The downgrade would have increased TPG's costs to finance the deal, said Bruce Packard, an analyst at Pali International Ltd. in London. ``The fact TPG had inserted the clause about a possible downgrade suggests that they knew this might happen,'' Packard said in a note to clients today.

TPG spokesman Simon Miller declined to comment.

The U.K. Shareholders' Association said it will back Bradford & Bingley's revised plans to raise 400 million because TPG's departure means less dilution for other investors. TPG got ``preferential treatment'' in the deal that Chairman Kent favored over an alternative proposal last month from Clive Cowdery's Resolution Ltd., the association said.

``The company is not a total dead duck and we will support the rights issue,'' said Roger Lawson, a spokesman for the association. ``There are still issues about the long term and the chairman will need to step down fairly soon.''

`Change of Management'

Mike Trippitt, a London-based analyst at Oriel Securities Ltd., cut his rating on Bradford & Bingley to ``reduce'' today. ``There needs to be a change of management and a change of control,'' he said. ``To have a credit rating downgrade and a strategic investor pulling out is troubling.''

Kent, 60, became chairman of Bradford & Bingley in 2002 and has acted as chief executive officer since June 1, when Steven Crawshaw said he was leaving due to ill health. Crawshaw, 47, told investors in April that the bank was well funded and didn't need to raise cash.

Less than one month later, Bradford & Bingley said mortgage arrears were rising, triggering a 56 percent drop in its shares.

Bradford & Bingley postponed a July 7 meeting to approve the TPG stake and rights offer to mid July. The bank said its largest shareholders support the plan to increase the size of the rights offering from 258 million pounds.

Legal & General Group, Standard Life, M&G Investment Managers and HBOS Plc's Insight Investment Management support Bradford & Bingley's revised funding plan, the bank said in a statement.

`Long-Term Prospects'

``We are positive about the long-term prospects and happy to participate in funding the future of Bradford & Bingley,'' said Standard Life spokesman Richard England. Standard Life has a 5.1 percent stake in the bank. Legal & General spokesman Steve Leach also confirmed it is backing the plan.

Citigroup Inc. and UBS AG remain as underwriters, Bradford & Bingley said. ``While we are disappointed that TPG intends to terminate its subscription agreement, I am pleased that Citi and UBS and our major shareholders continue to support our proposed capital issuance,'' Kent said in the statement.

Bradford & Bingley cut its rights-offering price by a third on June 2 to 55 pence a share after saying late mortgage payments rose to 2.2 percent at the end of April from 1.6 percent at year end. The bank is locked into a contract with GMAC to buy 2.1 billion pounds of mortgages through 2009. The quality of the loans is deteriorating at a ``significantly'' rapid rate, Moody's said.

Rejecting Resolution

Resolution, the holding company that Cowdery formed after selling his insurance company this year for 5 billion pounds, offered last month to inject 400 million pounds in Bradford & Bingley. Cowdery, who said he had the support of same investors now backing Bradford & Bingley's latest bailout, offered to pay 72 pence a share for a 29.9 percent stake before the bank rejected the plan.

Cowdery, 45, built Resolution from insurers' castoffs and sold it this year to London-based Pearl Group Ltd. He has a personal fortune of at least 130 million pounds.

Resolution spokesman Alex Child-Villiers wouldn't say whether the company will consider a new bid for Bradford & Bingley. ``We are watching the banking sector to see how it develops alongside other financial-services opportunities this summer,'' he said.

Cowdery was considering the investment in Bradford & Bingley as the first step in building ``a new, larger and stronger bank'' through more acquisitions, he said. Resolution withdrew the offer because Bradford & Bingley's board was ``obstructive'' and wouldn't allow access to the bank's books.

Bradford & Bingley rejected Resolution's offer June 27, saying it lacked clarity on ``funding, change of control and price.''

`Watch Negative'

``I wouldn't be surprised if Resolution does return, but at a share price closer to our target price'' of 20 pence, said Sandy Chen, a London-based analyst at Panmure Gordon & Co. who has a ``sell'' rating on the stock. That price assumes ``a significant recovery'' in earnings, he said.

Standard & Poor's Ratings Services said today it's keeping Bradford & Bingley ``watch negative.'' TPG's departure is ``a further blow'' to the lender's credibility and financial flexibility, S&P said in a statement. ``The withdrawal of TPG suggests reduced confidence in B&B's business model from the prospective largest shareholder,''

The Moody's downgrade means Bradford & Bingley's Aire Valley trust may be in danger of falling short of its liquidity- reserve criteria, Lehman Brothers analyst Aleksandar Devic wrote in a note today. The bank may need to create a liquidity reserve fund.

Credit-default swaps on Bradford & Bingley rose 75 basis points to 345 as of 8:45 a.m., according to CMA Datavision. A basis point on a contract protecting 10 million euros ($15.7 million) of debt from default for five years is equivalent to 1,000 euros a year.

Credit-default swaps are designed to protect bondholders against default and pay the buyer face value in exchange for the underlying securities or the cash equivalent should a company fail to adhere to its debt agreements.

Bloomberg.com: Worldwide

Butterfly · 05-07-2008, 02:01 PM

ok, so nothing is really happening with all the boring stories you are posting. Can you digg something that is relevant and mind provoking instead ?

it's like that you are counting the number of fallen trees after a tornado, surely there must be something more important than just fallen trees.

05-07-2008, 03:12 PM

Quote:

Originally Posted by Butterfly

ok, so nothing is really happening with all the boring stories you are posting. Can you digg something that is relevant and mind provoking instead ?

it's like that you are counting the number of fallen trees after a tornado, surely there must be something more important than just fallen trees.

OK, I'll give you a simplified version, as you seem to have difficulty reading articles with long words in them:

GMAC (quite an important US financial company, 49% owned by GM) is facing bankruptcy. This is certain without the lifeline of $4BN per year contracted income from the purchase of crap mortgages by the UK's Bradford & Bingley.
B&B, in turn, are facing insolvency (and IMO are already insolvent), which means they would repudiate their contract with GMAC.

B&B's share price closed at 50.75p, well below their supposed 'discounted' rights price of 55p.

So: B&B fails > GMAC fails > Credit Crunch gets a good deal more Crunchy!

21-06-2008, 04:58 AM	#225 (permalink)
bkkandrew Guest Posts: n/a	Bear Sterns Managers Arrested - how many more will follow? Feds arrest two former Bear Stearns hedge fund managers by The Associated Press Thursday June 19, 2008, 8:19 AM Federal authorities said two former Bear Stearns managers have surrendered in New York City to face criminal charges in the wake of the collapse of the subprime mortgage market. Daniel Acker/Bloomberg NewsRalph Cioffi, former manager at Bear Stearns, is escorted by police officers to federal court in Brooklyn borough of New York today. Authorities in Brooklyn are expected to give details later Thursday on the case against Ralph Cioffi, of Tenafly and Matthew Tanin, of Manhattan, who are ex-managers of Bear Stearns hedge funds that collapsed last year. Officials told The Associated Press that the former executives are suspected of misleading investors about the risky subprime mortgage market. They have been the target of the yearlong probe. Justin Lane/EPAMatthew Tannin, a former Bear Stearns hedge fund manager, is escorted by law enforcement officials after being arrested in New York today. Tannin's attorney has declined to comment and Cioffi's attorney has not responded to a phone message. Last month, Bear Stearns shareholders approved JPMorgan Chase's $2.2 billion buyout at about $10 a share. Back in January 2007, before mortgage defaults began clobbering banks and draining demand from the debt markets, Bear Stearns had traded at $171 a share.

29-06-2008, 05:06 AM	#229 (permalink)
bkkandrew Guest Posts: n/a	Wachovia lose $220BN. Best look down the sofa then... CDO Defaults Reach $220 Billion on Deerfield Failure (Update1) By Neil Unmack June 27 (Bloomberg) -- Deerfield Capital Management LLC and Declaration Management & Research LLC pushed the amount of collateralized debt obligations in default to $220 billion, according to Wachovia Corp. analysts. Downgrades to mortgage bonds and their underlying securities triggered so-called events of default on 200 CDOs since October, including Rosemont, Illinois-based Deerfield's Knollwood CDO Ltd. and Kent Funding II, managed by Declaration in McLean, Virginia, Wachovia analysts wrote yesterday. The total compares with 191 CDOs totaling $212 billion on May 21, according to the bank. The failures are equivalent to 36 percent of CDOs that include U.S. asset-backed debt sold since 2003, and 19.3 percent of all CDOs, Charlotte, North Carolina-based Wachovia said. Losses on the securities that pool assets including subprime mortgages contributed to the almost $400 billion of credit losses and writedowns by banks worldwide in the past year. CDOs repackage assets such as mortgage bonds and other debt into new securities that are then sliced into pieces with different ratings. About $32 billion of the funds have been wound down or face liquidation. CDOs of asset-backed bonds typically have rules that may force them to sell holdings when ratings of the underlying assets are downgraded below a set level. The triggers, or events of default, allow creditors to liquidate the fund or divert money to repay senior debt at the expense of other investors. Issuance of asset-backed CDOs has tumbled to less than $1 billion this year from $227 billion in 2007, according JPMorgan Chase & Co. data. Mortgage-Bond Prices Liquidations have helped push down prices on subprime and Alt-A mortgage bonds rated lower than AAA, UBS AG analysts wrote in a June 24 report. The expectation that more CDOs will be forced to sell mortgage assets has also contributed to price declines, the analysts said. The unwinding of CDOs and so-called structured investment vehicles offers ``serious resistance'' to the recent rally among asset-backed bonds, Deutsche Bank AG said in a June 16 report. While older AAA rated subprime-mortgage securities are priced to a ``severe recession,'' the potential for more forced sales makes the debt risky, the report said. From: http://www.bloomberg.com/apps/news?pid=20601087&sid=aqMZ6GS5sEcU&refer=home

03-07-2008, 05:43 AM	#230 (permalink)
bkkandrew Guest Posts: n/a	Interesting markeks today. HBO hammered, B&B battered and bruised & GM gushing money! See the FT Alphaville blog today: FT Alphaville » Blog Archive » Markets live transcript 2 Jul 2008 All going to sh1t. I'm going on holiday next week. Happy Days!

03-07-2008, 02:28 PM	#231 (permalink)
bkkandrew Guest Posts: n/a	Run on IndyMac Bancorp IndyMac denies that it's close to collapse Depositors have been pulling money from the Pasadena-based thrift, whose share price is down 90% this year. By E. Scott Reckard and Andrea Chang, Los Angeles Times Staff Writers Battling rumors that it may collapse, Pasadena-based IndyMac Bancorp acknowledged Monday that its financial position had deteriorated but described the fears as overblown and said it was working with regulators to improve its "safety and soundness." IndyMac, a national home lender burned by the mortgage meltdown, went public after depositors lined up at San Gabriel Valley branches starting Friday to pull out their money. Striving to reassure them, the thrift said nearly all their deposits were insured by the Federal Deposit Insurance Corp. Nonetheless, Elizabeth Brown closed four accounts totaling $200,000 Monday at an Arcadia branch where about 20 customers were lined up at noon, saying: "The only reason I'm panicking is if anything happens, my money is tied up. Continued at: IndyMac denies that it's close to collapse - Los Angeles Times

03-07-2008, 02:37 PM	#232 (permalink)
bkkandrew Guest Posts: n/a	US Community Banks Cease Lending, Facing Bankruptcy No Loans at Mountain 1st Means Bank Credit Drying Up (Update2) By Mark Pittman July 2 (Bloomberg) -- Mountain 1st Bank & Trust Co. Chief Executive Officer Greg Gibson forecast 12 percent loan growth for his North Carolina bank this year. Instead, he's spending more time handing out freshly baked cookies than extending credit. Gibson is ``standing on the brakes'' because Mountain 1st, owned by 1st Financial Services Corp. of Hendersonville, North Carolina, can no longer sell trust-preferred stock to raise capital for loans so customers can buy airplanes or build veterinary clinics, Gibson said in a June 20 telephone interview. The bank, with $650 million in assets, is among more than 8,000 across the U.S. caught for the past six months in the shutdown of the $117 billion market for the securities, a hybrid of debt and equity. The fallout from the subprime-mortgage collapse is spreading from global lenders such as Citigroup Inc. and UBS AG to local ones, including Lansing, Michigan-based Capitol Bancorp, FirsTier Corp. of Northglenn, Colo. and Mountain 1st, which tempts customers at log cabin-style branches with cookies and coffee. Less capital for such hometown banks may stymie Federal Reserve Chairman Ben Bernanke's effort to prevent a credit crunch. ``There is no question there is a problem,'' said Chris Cole, senior regulatory counsel for the Independent Community Bankers of America, a Washington-based trade group for about 5,000 lenders. ``Banks need the capital to lend. So that problem of raising capital causes a further slowdown. This inability to raise capital points to a damping of the whole economy.'' 10-Fold Growth So-called community banks and larger lenders have sold trust-preferred securities, known as TruPS, for about a dozen years. Collateralized debt obligations became the biggest buyers, generating enough demand to expand the market 10-fold, according to Merrill Lynch & Co. index data. The CDOs packaged the shares and sliced them into pieces with varying credit ratings. Community banks such as FirsTier were too small to attract insurance companies or mutual funds and sold the securities to CDOs instead, in issues of $10 million or $20 million at a time, according to Fitch Ratings analyst Nathan Flanders. The market was upended after mortgage foreclosures reached a record high of 2.47 percent for all loans in the U.S., starting a credit-market meltdown that sent investors fleeing to safer government securities. As the preferred market seized up, the Standard & Poor's Small Cap Regional Banks Index has fallen 34 percent this year, leaving banks unable to sell common stock without diluting existing shareholders. Cut off from fresh capital, some lenders may file for bankruptcy, according to ICBA's Cole. Continued here: Bloomberg.com: Exclusive

30-05-2008, 12:17 AM	#221 (permalink)
bkkandrew Guest Posts: n/a	Back to Bradford & Bingley. Closed down a further 7% today to 90.25. I wonder if the queues outside branches will start tomorrow...

31-05-2008, 05:24 AM	#222 (permalink)
bkkandrew Guest Posts: n/a	^Now at 88p, just 6p from the rights issue price, which is now bound to fail. UBS and Citi now have to split the £300M bill. Meanwhile, B&B will 'merge' with The Crock...

02-06-2008, 03:38 PM	#223 (permalink)
bkkandrew Guest Posts: n/a	As predicted: SHARES SUSPENDED http://www.londonstockexchange.com/LSECWS/IFSPages/MarketNewsPopup.aspx?id=1856932&source=RNS TPG Capital (”TPG”), a leading global private investment firm, has agreed to invest approximately £179 million and become a major strategic investor owning 23% of the Company upon completion - A Restructured Rights Issue will raise approximately £258 million and, together with TPG’s investment, will raise additional capital of approximately £400 million, net of expenses. All shares will be issued at an offer price of 55 pence per share - Difficult economic conditions have led to a decline in net interest margin and increasing arrears. Underlying profits for the first four months of the year amounted to £56 million compared to £108 million in 2007. The trading update highlights a more cautious outlook for the year - Steven Crawshaw has stepped down as Group Chief Executive with immediate effect as a result of serious illness. Chairman Rod Kent has become Executive Chairman (My comment): Crawhaw's illness appears to angina attacks, no wonder, as his bank goes bust! Hope you all got your money out, I did give you about 3-months notice!

02-06-2008, 03:44 PM	#224 (permalink)
bkkandrew Guest Posts: n/a	Oh and don't be fooled by this latest 'bad money after good' 'investment'. The new rights issue price has been reset to 55p (from 82p, which was doomed to failure as the shares slid). Current share price after the shares began trading again is 64p - down over 27% on Friday's close!

21-06-2008, 08:48 AM	#226 (permalink)
Butterfly Suspended Member Join Date: Mar 2006 Posts: 16,897	not sure where we are heading with all this, hedge funds have always been "dodgy", not sure why the arrests now, they could have done it before the meltdown, frauds outside the subprime mess were already committed,

29-06-2008, 02:38 AM	#228 (permalink)
bkkandrew Guest Posts: n/a	A great site: Watch banks GO BUST in real time: http://bankimplode.com/

03-07-2008, 03:13 PM	#233 (permalink)
Butterfly Suspended Member Join Date: Mar 2006 Posts: 16,897	Bank run is never good news, but most are local state banks, so not really national disaster, actually it is contained, nothing to see, next

03-07-2008, 03:25 PM	#234 (permalink)
bkkandrew Guest Posts: n/a	^Unless you have an account with them....

03-07-2008, 03:33 PM	#235 (permalink)
Butterfly Suspended Member Join Date: Mar 2006 Posts: 16,897	^ FDIC ? ever heard of them ?

03-07-2008, 03:36 PM	#236 (permalink)
bkkandrew Guest Posts: n/a	^Indeed. I am sure that is something that all people ache to do every day as a leisure activity, file an FDIC claim.

04-07-2008, 02:05 PM	#237 (permalink)
bkkandrew Guest Posts: n/a	Bradford & Bingley Bailed Out - TBG Walk Away So, as predicted, B&B (the UK's largest Buy-to-Let) lender has been snubbed by TPG (despite the fact they were being bribed by the FED to keep GMAC afloat, as B&B are contraced to buy $4BN worth of mortgages per year). The books really are that bad. The FSA has to step in, hats passed to taxpayer (again, ala Northern Crock) and Britain's reputation for financial competance sinks to the lowest level, well to a level slightly higher than it will be when HBOS sinks soon... From Bloomberg: BB:IX Bradford & Bingley PLC Related Company News BG Group, Bradford & Bingley: U.K., Irish Equity Preview July 3, 2008 22:02 EDT -- The following is a list of companies whose shares may have unusual price changes in U.K. and Irish markets today. Stock symbols are in parentheses, and prices are from the last market close. B&B Enlarges Rights Offer as TPG Exits Investment (Update2) July 3, 2008 21:38 EDT -- Bradford & Bingley Plc, Britain's largest lender to landlords, said it continues to be ``well funded'' even as TPG Inc. dropped plans to inject 179 million pounds ($354.7 million) after Moody's Investors Service said it would cut the Group's debt ratings by two levels. TPG Abandons B&B Deal; U.K. Investors to Inject Cash, BBC Says July 3, 2008 18:55 EDT -- Financial institutions in London are rallying to bolster Bradford & Bingley Plc after U.S. leveraged buyout firm TPG Inc. dropped plans to provide 179 million pounds ($354.8 million) in funding, the British Broadcasting Corp. reported, without saying where it obtained the information. Stoxx 600 Stocks With Highest, Lowest Average Analyst Rating July 3, 2008 13:04 EDT -- The following tables show the highest and Lowest average analyst ratings for stocks in the Dow Jones Stoxx 600 Index as of July 3. TPG Is Entitled to Drop Bradford & Bingley Investment, FT Says July 2, 2008 01:38 EDT -- TPG Inc., the U.S. leveraged buyout firm, can abandon its 179 million-pound ($353 million) investment in Bradford & Bingley Plc if the British mortgage lender's credit rating declines further, the Financial Times reported, citing the prospectus for B&B's rights offer. Bloomberg.com: Investment Tools

05-07-2008, 05:52 AM	#238 (permalink)
bkkandrew Guest Posts: n/a	Bradford & Bingley Investors on the Hook as TPG Walks (Update2) By Poppy Trowbridge and Jon Menon July 4 (Bloomberg) -- Bradford & Bingley Plc's largest shareholders agreed to lead a bailout of the U.K. mortgage lender after TPG Inc. abandoned plans to buy a 23 percent stake. Bradford & Bingley was forced to boost a proposed share sale to 400 million pounds ($738 million) after Moody's Investors Service cut its credit rating, giving the bank the lowest ranking in the U.K. and prompting U.S. buyout firm TPG to pull its planned investment. Investors Legal & General Group Plc and Standard Life Plc said they will buy new stock after it fell 18 percent today. TPG's pullout is the latest setback for Chairman Rod Kent, who faces the worst property slump since the 1990s and calls to resign. A surge in late mortgage payments forced the Bingley, England-based bank to slash the price of its rights offering in June and reverse earlier assurances that it didn't need new capital. ``Bradford & Bingley has been lurching from one disaster to another,'' said Leigh Goodwin, an analyst at Fox-Pitt, Kelton Ltd. in London who has an ``underperform'' rating on the stock. ``The key question is whether this is Northern Rock in slow motion, and that seems to be speeding up.'' The U.K. nationalized Northern Rock Plc in February after it ran out of funds amid the credit crunch and triggered the first run on a British bank in more than a century. Britain's Financial Services Authority, which acknowledged it didn't properly oversee Northern Rock, said it's working with Bradford & Bingley and its underwriters on the rescue plan. `All the Players' ``We're talking to all the players involved,'' FSA spokesman Joseph Eyre said today. The Bingley, England-based bank will offer 828 million shares, or 67 new shares for every 50 existing shares, it said in a separate Regulatory News Service statement today. The bank fell to 50 pence, the lowest since it sold shares in December 2000. That's 5 pence below the rights- offering price, valuing the bank at 309 million pounds. The shares are down 81 percent this year, making it the worst performer in the Bloomberg Europe Banks and Financial-Services Index. Alliance & Leicester Plc, a mortgage lender based in Leicester, England, fell 12 percent to 255.5 pence. HBOS Plc, the U.K.'s largest mortgage lender, fell 2.8 percent to 271.5 pence, below the strike price for its planned 4 billion-pound rights offering to raise new capital. Financial firms worldwide have raised 321 billion of new capital after posting more than $400 billion in losses and writedowns since the credit-market meltdown began last year. Fort Worth, Texas-based TPG exercised a clause to withdraw its offer of 179 million pounds for a stake in Bradford & Bingley after Moody's cut Bradford & Bingley debt rating to Baa1 from A3 and cited a ``substantial deterioration'' in asset quality. Bad Omen The downgrade would have increased TPG's costs to finance the deal, said Bruce Packard, an analyst at Pali International Ltd. in London. ``The fact TPG had inserted the clause about a possible downgrade suggests that they knew this might happen,'' Packard said in a note to clients today. TPG spokesman Simon Miller declined to comment. The U.K. Shareholders' Association said it will back Bradford & Bingley's revised plans to raise 400 million because TPG's departure means less dilution for other investors. TPG got ``preferential treatment'' in the deal that Chairman Kent favored over an alternative proposal last month from Clive Cowdery's Resolution Ltd., the association said. ``The company is not a total dead duck and we will support the rights issue,'' said Roger Lawson, a spokesman for the association. ``There are still issues about the long term and the chairman will need to step down fairly soon.'' `Change of Management' Mike Trippitt, a London-based analyst at Oriel Securities Ltd., cut his rating on Bradford & Bingley to ``reduce'' today. ``There needs to be a change of management and a change of control,'' he said. ``To have a credit rating downgrade and a strategic investor pulling out is troubling.'' Kent, 60, became chairman of Bradford & Bingley in 2002 and has acted as chief executive officer since June 1, when Steven Crawshaw said he was leaving due to ill health. Crawshaw, 47, told investors in April that the bank was well funded and didn't need to raise cash. Less than one month later, Bradford & Bingley said mortgage arrears were rising, triggering a 56 percent drop in its shares. Bradford & Bingley postponed a July 7 meeting to approve the TPG stake and rights offer to mid July. The bank said its largest shareholders support the plan to increase the size of the rights offering from 258 million pounds. Legal & General Group, Standard Life, M&G Investment Managers and HBOS Plc's Insight Investment Management support Bradford & Bingley's revised funding plan, the bank said in a statement. `Long-Term Prospects' ``We are positive about the long-term prospects and happy to participate in funding the future of Bradford & Bingley,'' said Standard Life spokesman Richard England. Standard Life has a 5.1 percent stake in the bank. Legal & General spokesman Steve Leach also confirmed it is backing the plan. Citigroup Inc. and UBS AG remain as underwriters, Bradford & Bingley said. ``While we are disappointed that TPG intends to terminate its subscription agreement, I am pleased that Citi and UBS and our major shareholders continue to support our proposed capital issuance,'' Kent said in the statement. Bradford & Bingley cut its rights-offering price by a third on June 2 to 55 pence a share after saying late mortgage payments rose to 2.2 percent at the end of April from 1.6 percent at year end. The bank is locked into a contract with GMAC to buy 2.1 billion pounds of mortgages through 2009. The quality of the loans is deteriorating at a ``significantly'' rapid rate, Moody's said. Rejecting Resolution Resolution, the holding company that Cowdery formed after selling his insurance company this year for 5 billion pounds, offered last month to inject 400 million pounds in Bradford & Bingley. Cowdery, who said he had the support of same investors now backing Bradford & Bingley's latest bailout, offered to pay 72 pence a share for a 29.9 percent stake before the bank rejected the plan. Cowdery, 45, built Resolution from insurers' castoffs and sold it this year to London-based Pearl Group Ltd. He has a personal fortune of at least 130 million pounds. Resolution spokesman Alex Child-Villiers wouldn't say whether the company will consider a new bid for Bradford & Bingley. ``We are watching the banking sector to see how it develops alongside other financial-services opportunities this summer,'' he said. Cowdery was considering the investment in Bradford & Bingley as the first step in building ``a new, larger and stronger bank'' through more acquisitions, he said. Resolution withdrew the offer because Bradford & Bingley's board was ``obstructive'' and wouldn't allow access to the bank's books. Bradford & Bingley rejected Resolution's offer June 27, saying it lacked clarity on ``funding, change of control and price.'' `Watch Negative' ``I wouldn't be surprised if Resolution does return, but at a share price closer to our target price'' of 20 pence, said Sandy Chen, a London-based analyst at Panmure Gordon & Co. who has a ``sell'' rating on the stock. That price assumes ``a significant recovery'' in earnings, he said. Standard & Poor's Ratings Services said today it's keeping Bradford & Bingley ``watch negative.'' TPG's departure is ``a further blow'' to the lender's credibility and financial flexibility, S&P said in a statement. ``The withdrawal of TPG suggests reduced confidence in B&B's business model from the prospective largest shareholder,'' The Moody's downgrade means Bradford & Bingley's Aire Valley trust may be in danger of falling short of its liquidity- reserve criteria, Lehman Brothers analyst Aleksandar Devic wrote in a note today. The bank may need to create a liquidity reserve fund. Credit-default swaps on Bradford & Bingley rose 75 basis points to 345 as of 8:45 a.m., according to CMA Datavision. A basis point on a contract protecting 10 million euros ($15.7 million) of debt from default for five years is equivalent to 1,000 euros a year. Credit-default swaps are designed to protect bondholders against default and pay the buyer face value in exchange for the underlying securities or the cash equivalent should a company fail to adhere to its debt agreements. Bloomberg.com: Worldwide

05-07-2008, 02:01 PM	#239 (permalink)
Butterfly Suspended Member Join Date: Mar 2006 Posts: 16,897	ok, so nothing is really happening with all the boring stories you are posting. Can you digg something that is relevant and mind provoking instead ? it's like that you are counting the number of fallen trees after a tornado, surely there must be something more important than just fallen trees.

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