³ÉÈË¿ìÊÖ

Another nail in the coffin of UK PLC? Santander the first of many foreign giants to sift through the bones before the lid goes on.

Surely this should send a chill down the spine of every stakeholder in every small mortgage bank in the country?

A bigger concern to me is how Santander will perform long-term, and how it will be regulated, as a Spanish company, albeit probably has/will have a UK listing.

Peter

The vultures are gathering.

No doubt in my mind that this will not be last "take over" by a foreign business during the turbulent times to come.

1*

I dont think there is anything one can add to magicspacebar

sums up our demise perfectly

This article suggests that banks (including Santander) know what they're doing.

If you think that the English mortgage scenario is bad you out to see how the Spanish property market is going.

Are Banco Santander overpaying or underpaying?

How do you determine the future value of a mortgage book in times as 'interesting' and uncertain as these?

Banks, like Alliance and Leicester are mainly worth what their assets will bring in in the future - that is what is being paid for by Banco Santander. We must all hope their gamble pays off.

My feeling is that all present managements have little or no experience of such conditions and will be as blind as the rest of us.

There is a big issue here - around the potential tax break that lies behind Santander's reasoning. The mark to market issue may make this exceedingly well timed for them

Was similar for Ferrovial and BAA deal of recent times.

More detail here

A&L's acting chairman Roy Brown says his board couldn't turn the offer down because of what he called "the significant external risks presented by the deterioration in economic conditions and the continuing turbulence in the financial markets".


Oh yes, and weren't all the prominent financial and economic "experts" telling us that the worst of the credit crunch was over a few weeks ago? So, I take it then that the crisis with Freddie Mac and Fannie Mae that has played out over the last few days is the credit crunch getting better? Where would we be without all these experts to ensure that all our problems are addressed so competently?

So Brits buy property in Spain (to flee UK)and Spaniards buy banks and airports in UK on cheap. Labour have a lot to answer for.

Robert

The reason this deal went thru was because it was a great deal for the Spanish bank.

In turbulent times, why don't they try issuing other forms of Equity ?

Such as my personal favourite:

Convertible Preference Shares

They can be sold for a pound each, convertible in the future (many years away if needed) into Ordinary Shares at a given rate, and they have a fixed rate of return until converted.

Whats not to like ?

Worrying to see how much power the Shortsellers seem to have over the Stock market and the companies listed thereon.

Disproportionate influence in the hands of a small number of people.........

Where will it all end ?

#13 I'm not familiar with the exact regulatory treatment of convertible shares, but don't you think they will simply be treated as debt until they are converted? If so, they won't help the solvency capital position of the bank much.

1. So Santander gets to combine Abbey and A+L. Will it then make sense for them to sell this off as a viable independent entity?

2. Is this deal really a merger rather than an acquisition? or does Santander expect to fork out real money for the A+L shares?

Index tracking funds will hold large amounts of shares like RBS. Can their fund managers lend the shares, for shorting, without risk since their primary performance target is to track the index rather than maximise the value of their fund?
Are there any special rules for this situation?

If a large number of, e.g. RBS, shares are held in such funds then can this information be used to forecast that these shares are less liquid than other shares/commodities? Does this create a damping mechanism that reduces short term volatility but extends the period over which share price changes occur?
This is perhaps slightly off topic but relevant to understanding the value of shares in the banking sector?

Robert,

Are you ready to admit at last that you completely missed the story with the credit crunch issue? You were so determined to focus the issue on NR - causing a run there
by deliberately linking the liquidity issue to security of deposits which was nonsense- that the wider picture just passed you right by- didn't it?. Banks- such as Abbey- that were already owned by Santander had the massive advantage of being able to look to the ECB for liquidity whereas NR- wholly UK owned -had to go to the BoE. The Fed reserve and ECB handled the situation sensibly, whereas the BoE leaked the story to a reporter trying to make a name for himself irrespective of the damage his irresponsible reporting did and the rest is history....

Is the world being run with monopoly money?

We hear of billions or trillions being poured into banks to keep them going.

Who is printing this money and what is the true value of anything anymore.

No doubt we will find out soon enough.

#18, virtualsilverlady

The intrinsic value of the five pound note in your pocket is nothing. It only has value because the people you hand it to in payment accept it as having a value. In other words, everybody accepts the promise written on it.

Many months ago when Z$500 notes were still in use in Zimbabwe, prices were such that a single sheet of toilet paper was "worth" Z$550. This naturally led to much speculation as to the likely fate of the Z$500 notes. That shows you the intrinsic value of the notes in your pocket.

Inflation is already hurting people badly. The CPI is all well and good as a figure but doesn't reflect the things that people actually have to buy. Wait for things to get worse...

No Preference Shares though old fashioned are a class of Equity.

To the best of my knowledge acceptable for the capital rules.

I would be interested in Roberts views on Convertible Preference Shares.

Convertible Bonds yet another fund raising technique were used to great effect by the old Hanson Trust many years ago.

It is an irrelevance.
Banks are destined to fail.

The people who feed the banking system..the middle class... are going bust.

They (the middle class) are slowly waking up to the fact.

The words Grand Slam come to mind !

So long as no one is planning a National Emergency Resource Coordinating Commission (NERCC) we'll probably be okay !

In other words, it's not the end of the world, not by a long way.

We could do with the Electric cars about now.......

Perhaps Bidders will appear for B and B now their rights Issue has been accepted by shareholders.

Accepted according to FT Alphavilles report.

Clive Cowdery was prepared to offer 70ish pence per share in his refinancing.

Would that be the take out price I wonder ?