www.virgin.com/money/news/virgin ... thern-rock This has been in the pipeline for a good while now, but a deal has just been formally announced. Personally I think it's great that it's back in private hands after the previous government's chest beating exercise (or essential actions, depending on your beliefs), and even better that an effective new bank has been created, which should help to break the stranglehold some of the big banks have right now. This, to me, is the deal that should have been done with RBS's sale of it's Williams & Glyns network.

www.virgin.com/money/news/virgin ... thern-rock This has been in the pipeline for a good while now, but a deal has just been formally announced. Personally I think it's great that it's back in private hands after the previous government's chest beating exercise (or essential actions, depending on your beliefs), and even better that an effective new bank has been created, which should help to break the stranglehold some of the big banks have right now. This, to me, is the deal that should have been done with RBS's sale of it's Williams & Glyns network.

You'd presumably rather it had gone under, then, with the concomitant job loses etc?

No of course not. I'd have preferred it to be acquired by either private equity (essentially what Virgin Group is) or it raised money through foreign investment, like Barclays did. That could have been done straight away without the need for the government to turn it into one of their departments.

Whatever the rights or wrongs, anyway, this deal has turned out good. According to Virgin, the government will receive £747m immediately, another £50m within months, and a potential £1bn following flotation within five years. And lets face it, we could do with the money.

It would only have affected pensioners and geordies, non-contributors to the economy as they are they don't count.

Genuine question, as I don't know the answer, but which private and/or foreign investors were looking to invest/take over UK banks at the time?

So around a £700m loss? Yep, a great deal.

If you're looking for foreign banks on the acquisition trail, then you only have to look at Santander who've hoovered up pretty much everything over here, including RBS's Williams & Glyns network. Also National Australia Group (owners of Yorkshire and Clydesdale) aren't short of cash either.

However investment doesn't have to come in the form of being 'bought out', as I understand it. Barclays raised money through share issues and by restructuring its own book (I believe). As for the investors involved, these are usually private equity houses, such as the Virgin's partners in the Northern Rock deal.

My only problem, really, with the whole Northern Rock thing is that Virgin were there at the beginning, and if the government had just thought for one second, they wouldn't have had to nationalise it, as Virgin were already in the frame to buy it. They had the money, the business plan and everything - we know this because they had done most of the legwork in their bid to buy Bradford & Bingley. The government were a bit like a bull in a china shop on this one.

Quote ="tb"So around a £700m loss? Yep, a great deal.'" So you agree with the Daily Mail, then? There's a turn up! www.dailymail.co.uk/news/article ... ocket.html On a serious note - by 'good' I meant that the outcome is as good as can be expected. The Labour government massively overpaid for the business, and at least this way, the current government and at least get some money in. Therefore, it's good. However as I said in my previous post, had the Labour government allowed Virgin to talk to them and Northern Rock instead of wading in like they did, then this loss wouldn't have happened, would it?

Quote ="tb"So around a £700m loss? Yep, a great deal.'" So you agree with the Daily Mail, then? There's a turn up! www.dailymail.co.uk/news/article ... ocket.html On a serious note - by 'good' I meant that the outcome is as good as can be expected. The Labour government massively overpaid for the business, and at least this way, the current government and at least get some money in. Therefore, it's good. However as I said in my previous post, had the Labour government allowed Virgin to talk to them and Northern Rock instead of wading in like they did, then this loss wouldn't have happened, would it?

Well indeed.

Many commentators have pointed out the loss: through, admittedly, Robert Peston has it slightly smaller than £700m Quote BBC business editor Robert Peston said taxpayers had injected £1.4bn into Northern Rock plc. He added that in addition to the immediate £747m the government will get back following the completion of the sale, there is the potential for the Treasury to receive a further £280m over the next few years. "So on paper, taxpayers end up with a loss of somewhere between £400m and £650m," said our business editor.'" www.bbc.co.uk/news/business-15769886 Oh, and on the bit of Northern Rock which we still own and the taxpayer is still liable for (the bit with the 'toxic' assets) Quote The size of the losses contained in the bad bank part of Northern Rock are still uncertain, but could amount to as much as £21bn.'" tbh, you and Gideon hailing this as good business (and blaming the previous government when the flies in the ointment are pointed out) is simply one of the clearest examples going of the triumph of ideology over judgement.

Many commentators have pointed out the loss: through, admittedly, Robert Peston has it slightly smaller than £700m Quote BBC business editor Robert Peston said taxpayers had injected £1.4bn into Northern Rock plc. He added that in addition to the immediate £747m the government will get back following the completion of the sale, there is the potential for the Treasury to receive a further £280m over the next few years. "So on paper, taxpayers end up with a loss of somewhere between £400m and £650m," said our business editor.'" www.bbc.co.uk/news/business-15769886 Oh, and on the bit of Northern Rock which we still own and the taxpayer is still liable for (the bit with the 'toxic' assets) Quote The size of the losses contained in the bad bank part of Northern Rock are still uncertain, but could amount to as much as £21bn.'" tbh, you and Gideon hailing this as good business (and blaming the previous government when the flies in the ointment are pointed out) is simply one of the clearest examples going of the triumph of ideology over judgement.

Quote ="ROBINSON"So you agree with the Daily Mail, then? There's a turn up! www.dailymail.co.uk/news/article ... ocket.html On a serious note - by 'good' I meant that the outcome is as good as can be expected. The Labour government massively overpaid for the business, and at least this way, the current government and at least get some money in. Therefore, it's good. However as I said in my previous post, had the Labour government allowed Virgin to talk to them and Northern Rock instead of wading in like they did, then this loss wouldn't have happened, would it?'" You have a short or selective memory. The (Labour) government was terrified of being branded as a nationalising government, they bent over backwards to avoid nationalisation and it was only undertaken as a last resort. As it is, the current government is selling off an asset at a cut price with all the toxicity removed. Just like old times, isn't it?

Quote ="ROBINSON"So you agree with the Daily Mail, then? There's a turn up! www.dailymail.co.uk/news/article ... ocket.html On a serious note - by 'good' I meant that the outcome is as good as can be expected. The Labour government massively overpaid for the business, and at least this way, the current government and at least get some money in. Therefore, it's good. However as I said in my previous post, had the Labour government allowed Virgin to talk to them and Northern Rock instead of wading in like they did, then this loss wouldn't have happened, would it?'" You have a short or selective memory. The (Labour) government was terrified of being branded as a nationalising government, they bent over backwards to avoid nationalisation and it was only undertaken as a last resort. As it is, the current government is selling off an asset at a cut price with all the toxicity removed. Just like old times, isn't it?

Cut price?

Do you want to back that up?

tb already has.

We have put £1.4bn into Northern Rock plc.
We'll get £747m ... plus (maybe) £280m later.

But the toxic debt is till in the "other bit" of Northern Rock, possibly £21bn-worth.

The only reason to sell right now is that Ozzie has fecked-up economic growth and, without flogging stuff off, can't reduce the deficit as quick as he said he could.

Two companies that deserve each other. I hope it's written in that there will be no future bail out.

And indeed, carried on the privatising policies of the previous administrations.

Damned socialists, eh?

That doesnt suggest for one minute that Virgin Money are getting Northern Rock at a cut price. If anything, it suggests that the government overpaid, whch would not have happened had they allowed Virgin to talk to Northern Rock in the first place.

This really is not rocket science.

It suggests the possibility of both tbh.

But neither argument suggests the truth of the matter and unequivocal statements can't be made at all.

Who knows how much NR is worth now? Or was worth at the time?

Virgin money I recall offered close to double that when Labour were in power.

It is a good deal right now but is now the time to do the deal?

We are getting back less than we paid and it doesn't include the part with the worst risk.
It's pretty obvious unless you are a blind eyed Tory boy (Oh wait).

Quote ="Gideon" "Some may say that selling a fragile bank at a loss in the midst of a potentially catastrophic debt crisis and with a second credit crunch looming on the horizon is not necessarily a spiffing idea. "And I would say 'I have absolutely no idea what any of that means'."'" Satire gets it right again: www.thedailymash.co.uk/news/busi ... ne-to-use-£747m-from-northern-rock-sale-to-bail-out-new-owners-201111174558

Quote ="Gideon" "Some may say that selling a fragile bank at a loss in the midst of a potentially catastrophic debt crisis and with a second credit crunch looming on the horizon is not necessarily a spiffing idea. "And I would say 'I have absolutely no idea what any of that means'."'" Satire gets it right again: www.thedailymash.co.uk/news/busi ... ne-to-use-£747m-from-northern-rock-sale-to-bail-out-new-owners-201111174558

Of course, as eni fule (ie Robinson) kno, it's just ignorant lefties with an axe to grind against "Toooooorreeehs" who can't see this as A Good Deal.



oh …

is there any banking business that is worth the same now as it was worth a few years ago?

Probably not, which makes it a ridiculous time to sell when the price you can get is going to be so low.

The immediate future looks bad for banks, so you could argue it's a good, albeit desperate, time to sell.

The banks themselves don't have much confidence - announced job lossses - Llotds 14,000, Bank of America 30,000, HSBC 30,000, etc, etc

The good time to sell is one where you're going to get the best price.

Under no set of criteria is this the right time to be selling off a bank, unless you desperately need the cash to meet some economic forecasts.