Bradford & Bingley given go-ahead for rights issue

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

Fewer than 100 investors gathered for the meeting at Sheffield Arena in England, 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 (€504m) 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.”

He told the 56 shareholders who had gathered in the 15,000 seat arena: “The process of raising capital has not been a smooth or an easy one for Bradford & Bingley.

“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.