Bradford and Bingley Trading Update or Warning?

Bradford & Bingley (BB.), the biggest lender of buy-to-let mortgages in the UK, has confirmed that CEO Steven Crawshaw is to step down due to ill health.

In a statement B&B said that Mr Crawshaw will step down with immediate effect due to "a serious cardiovascular condition."

Rod Kent, will take over as executive chairman while a new CEO is sought.

B&B will also provide a trading update on Monday, but refused to comment on whether there will be a profits warning.

Press reports are warning of a profits alert.

According to the Sunday Times the profits warning will be included with the rights-issue document that investors will receive in the next five days. Profits are expected to be significantly lower than analysts' forecasts. The bank has suffered from the increasing numbers of people falling into arrears and from « squeezed margins ».

The Sunday Telegraph also ran the story.

The papers have refused to reveal their sources, but they expect the announcement to cause concern that UK banks are "sitting on a time-bomb of rising mortgage arrears and mounting bad debt." Looks like tin hats will be a requirement again for Monday morning.

Strangely, the share price fell sharply on Friday afternoon from 92p to 86p and has plummeted from over £5 to under 90p in about 2 years .

Most analysts think that a takeover is now inevitable, the only point of discussion being the price.

The bulletin boards are very busy and very entertaining but how useful they are is another matter, lots of "I told you so" "This is going to 20p" "Now is the time to stock up" etc... ! Personally I'll be steering well clear.

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