Bradford & Bingley Returns To Profit
By ReadingRabbit, March 31, 2011 in House prices and the economy
ReadingRabbit
Location:Reading
Big Banking
Bradford & Bingley returned to profit in 2010 according to the state-owned firm which manages the bank.
UK Asset Resolution said Bradford & Bingley made a statutory pre-tax profit of £1.08bn in 2010, compared with a loss of £196m in 2009.
Northern Rock Asset Management - the so-called "bad bank" part of Northern Rock - also made a profit.
NRAM reported a profit of £400.5m in 2010, compared with a loss of £257.5m in 2009.
UKAR's role is to run Northern Rock and Bradford & Bingley for the benefit of taxpayers.
BBC news link http://www.bbc.co.uk/news/business-12917578
We will soon find out if these profit are 'accounting adjustments'
Bloo Loo
Ripened on the Diversity Vine
Location:Essex-the land of Equality
About Me:Im Bloo yabba dee yabba die.
BBC news link http://www.bbc.co.uk...siness-12917578
Its easily done.
you have a bad loan say 100K...you approach the defaulter and offer to buy his house at market value via a shell, say 100K, which you finance with the amount of the purchase.
You buy shares in the shell, lets say its 100K.
The loan is paid off buy the defaulter recieving his 100K. hooray.
you now have another asset of 100K in a property shell company.
hooray.
You are a bad bank so you dont have to pay anybody.
so from being 100K in the shite, you now have a clean loan book and a fresh asset of 100K...earning you a dividend.
Of course, the shell has a deflating house and a bill to pay...next year.
TheCountOfNowhere
Location:Nowhere
About Me:Number of blocked trolls 86
Easy to make a profit when you're lending out at between 5%-20% and paying your investors 1%.
F**king joke.
CharlieChuck
According to their report
http://corporate.bbg.co.uk/~/media/Files/B/Bradford-And-Bingley-Corporate/pdf/results-and-publications/year-2010/financial-results/2010-annual-report.pdf
786mn of the 1bn profit comes from "Gain on repurchase of subordinated liabilities" whatever that is
edit: spelling
Edited March 31, 2011 by CharlieChuck
ralphmalph
B&B do not lend money anymore or offer savings accounts. The good bits of B&B were sold to Santander and the bad bits nationalised and put in stasis in the hope that people would pay there mortgages and the tax payer gets its money back. Only another 27 years to go at this rate.
http://corporate.bbg...nual-report.pdf
" A typical example for this would be when a promoter of a company invests money in the form of debt"
Sounds like an investment in shell companies.
MinceBalls
Sounds like they are buying back debt that was deemed junk and then revaluing it to something they fancy that looks like a nice tidy profit.
2008: 'whoops, we hold a load of worthless cr@p'
2009: 'lets sweep our worthless cr@p under the carpet (put it in the asset protection scheme) and book a small loss against it even though it is worthless'
2011: 'Everyone has forgotten that we used to have a load of worthless cr@p on our books so let's bring it back in now the dust has settled and value it at a profit again'
R K
Location:Republik of Mancunia
........at the sign of the unrolled prophylactic...............
I think I've found what it is. Note 7, 27 and 28 of the report.
In June and December 2010 the Group and Company repurchased certain of their own subordinated liabilities and other capital instruments, realising a total net gain of £786.0m. Further details of the repurchases are provided in notes 27 and 28. There were no repurchases in 2009.
They've repurchased bonds that B&B previously issued. These bonds were now trading as near junk status, so they bought back their own sold on debt at a discount to what they originally sold it for. Hence the "paper" profit.
Edit to add: there's only 339mn left of these bonds, so this level of additional bonus profit won't be achievable again.
Location:My Cubicle. Too Small. Getting Smaller. Help. Please Help Me
About Me:I could put... I could put... strychnine in the guacamole. There was salt on the glass, BIG grains of salt.
I had an ISA with the bradford and bingley.
For years the B&B staff let anyone who scribble their sign, borrow enough to buy loads of houses. They even printed on their literature, House Prices will never go down. Their main product was the BTL mortgage.
B&B staff used to call me on an evening, trying to flog me shares after they were bailed out by the Government.
I tried to explain to them that their fraudulent activities, had ensured I could never afford a house, and placed me in debt slavery.
Did not have slightest f@cking clue as to what I was talking about. Sheep.
Her attitude was that, they were going to put a shiny red sign over the door, on Monday [The Abbey] . No-one has lost their job at this branch. And they will carry on regardless. The only change they saw was a different sign being placed over the door.
Fergus Wilson banked with the B&B. Britains BTL king, who was able to borrow enough to purchase 900 houses, before the B&B wen bust to the tune of £50 billion and were bailed out by the taxpayer.
Edited March 31, 2011 by Dan1