Bradford & Bingley crashes into red

Beleaguered lender Bradford & Bingley today said it had crashed into the red in the first half of 2008, after credit crunch losses and rising bad debts.

The buy-to-let specialist made pre-tax losses of £26.7m (€33m), compared with profits of £180.4m (€224m) in the same period last year.

B&B said bad debt charges on its lending had jumped to £74.6m (€92.6m) from just £5.3m (€6.6m) last year as more borrowers struggled to keep up payments.

The firm also wrote off £155m (€192m) on investments hit by the continuing financial turmoil.

B&B added that it was cautious over prospects for the rest of the year as the housing market worsened.

It said: “In the light of continuing weakness in the housing market and the wider economy, we continue to expect arrears and repossessions to increase for the remainder of the year, although we will be putting further resources into tackling the problem.”