UK Govt to nationalise Bradford & Bingley Saturday, September 27, 2008
News is emerging tonight that the Govt has decided to nationalise Bradford & Bingley using the legislation created for Northern Rock.
The Bank had teetered in recent weeks as concerns have mounted about its' lending book, which has about $41bn of mortgages classified as self-certified [income was not independently verified] or buy-to-let. These are considered highly susceptible to losses.
The likelihood is that the Treasury will split up the mortgage book and sell off the safer elements whilst retaining the riskiest mortgages referred to above, probably taking these into Northern Rock in order to merge the administration functions. It is conceivable that the branch network could be sold separately.
Job losses are inevitable adding to the huge numbers already lost in the financial services industry.