We received a petition asking:
“We the undersigned petition the Prime Minister to ensure investors in Bradford & Bingley plc receive a fair price for their shares.”
Details of Petition:
“Bradford & Bingley was a going concern and could have continued trading or have been bought by another company. In nationalising the company and taking the shares into treasury ownership the government have effectively stolen from the shareholders of the company. Recompense is due and the government must make a fair and reasonable payment for the shares it has compulsorily acquired.”
· Read the petition
· Petitions homepage
Read the Government’s response
Following the turbulence in global financial markets, Bradford & Bingley found itself under increasing pressure as investors and lenders lost confidence in its ability to carry on as an independent institution. The FSA determined in the morning of Saturday 27 September that the firm no longer met its threshold conditions for operating as a deposit taker under the Financial Services and Markets Act 2000 and FSA rules.
The Government, on the advice of the FSA and the Bank of England, acted immediately to maintain financial stability and protect depositors, while minimising the exposure to taxpayers. It worked over the weekend to bring about a part public, part private solution which best meets those objectives. Following the FSA’s determination, Bradford & Bingley would have been unable to continue trading and therefore, had the Government not taken action, Bradford & Bingley would have had no alternative but to go into administration or liquidation.
The Bradford & Bingley Compensation Scheme Order made last December provides for an independent valuer to assess any compensation payable to the former shareholders of Bradford & Bingley.
The statutory framework which the independent valuer will apply represents a fair and reasonable basis for determining that. The only valuation assumption applicable is that all public financial assistance should be assumed to be withdrawn and no further such assistance provided. This is no more than would have occurred in an administration or liquidation, where any return to shareholders would have been made after repayment of all public financial assistance.
The Treasury Select Committee took evidence last year from Rod Kent (former Chairman) and Richard Pym (current Chairman) of Bradford Bingley on the difficulties the company faced. Their evidence will be of assistance to you and can be found at:
http://www.publications.parliament.uk/pa/cm200708/cmselect/cmtreasy/uc1167-iii/uc116702.htm
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