FSA seeks buyer for Bradford & Bingley

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by Gill Montia

The Financial Services Authority (FSA) has renewed its attempts to facilitate the sale of Bradford & Bingley (B&B), the troubled buy-to-let mortgage lender.

While B&B’s says its capital position is sound, the lender’s falling share price has led to speculation that it will not survive the turmoil of today’s credit markets and the FSA is keen to pre-empt a crisis by helping the bank find a buyer.

Reports in the weekend press suggest that the regulator has approached National Australia Bank, the Dutch parent company of ING Direct in the UK, and Banco Santander, the Spanish group that owns Abbey.

B&B posted a pre-tax loss of £26.7 million for the six months to the end of June. The result compares with a profit of £180.4 million in the same period of 2007.

Credit impairment charges for the period rose to £74.6 million, up from £5.3 million in the first half of last year.

The steep rise came largely as a result of an increase in the number of mortgages in arrears of three months or more but the results included an impairment charge of £18 million for mortgage fraud.