The long awaited and much speculated over Bradford & Bingley rights issue has failed to raise the £400million needed to shore up its balance sheet.
The buy to let mortgage
specialist managed to shift just 27.84 per cent of the new shares on offer at 55p, just higher than today's share value. As a result, underwriters have been left with as much as £300million in shares to pick up.
In fact, underwriters Citi and UBS are expected to attempt to place the shares between themselves and their sub-underwriters, HSBC, Lloyds TSB, HBOS, Barclays, Abbey and Royal Bank of Scotland, by Friday.
Despite three quarters of the rights issue being left high and dry, Bradford & Bingley's attempt at raising cash was actually more successful than the attempt by HBOS to raise £4billion, which saw shareholders take up just eight per cent as share prices dropped below the rights issue price.
The news comes as Bradford & Bingley announces the arrival of a new chief executive, Richard Pym. The news is hoped to boost consumer confidence in the buy to let mortgage
specialist. Commenting on his new post, Richard Pym said:
"Bradford & Bingley has developed strong customer franchises in savings and lending and I am delighted to have been invited to lead the business. I look forward to working with the Board and executive team in building a successful future."
Bradford & Bingley is due to announce its long awaited six month results to June 30 on August 29.
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