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gruffydd

Alliance And Leicester Wiped Out By Credit Crunch

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Alliance & Leicester, the UK mortgage bank which is under offer from Santander of Spain, just scraped through to report a first-half profit after writedowns to its treasury assets and higher funding costs. The group reported a statutory pre-tax profit of £2m (a 23.9m net loss!!!!)

http://www.bloomberg.com/apps/news?pid=206...Bw&refer=uk

So there is some truth in the rather terrifying rumours sweeping the City at the moment!

Edited by gruffydd

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Interesting - foreign media completely trashing A&L - reporting a loss - UK media reporting a profit:

Alliance & Leicester Has First-Half Loss on Markdowns (Update3)

By Ben Livesey and Jon Menon

Aug. 1 (Bloomberg) -- Alliance & Leicester Plc, the U.K. bank that agreed to a takeover by Banco Santander SA, posted a first- half loss because of credit writedowns and higher funding costs.

The net loss was 23.9 million pounds ($47.4 million), or 5.7 pence a share, compared with a profit of 183.6 million pounds, or 41.6 pence, a year earlier, the Leicester, England- based bank said today in a statement.

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Any idea what its tax liability is?

£ -2mn tax (i.e. it can offset against future tax) [ EDIT: Thats 80mn less tax revenue coming in]

half yearly report

there was another thread earlier,

http://www.housepricecrash.co.uk/forum/ind...showtopic=83551

Ignoring write offs the profit was 50mn odd less than the last 6month period (it would have been about 150mn before write offs to ABS's and Cdo's etc). Have they just written off enough to still make a profit, knowing there will be bigger future write offs?

Edited by CharlieChuck

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Alliance & Leicester, the UK mortgage bank which is under offer from Santander of Spain, just scraped through to report a first-half profit after writedowns to its treasury assets and higher funding costs. The group reported a statutory pre-tax profit of £2m (a 23.9m net loss!!!!)

http://www.bloomberg.com/apps/news?pid=206...Bw&refer=uk

So there is some truth in the rather terrifying rumours sweeping the City at the moment!

It's not that bad really, at least they made some profit, even making a loss wouldn't wipe them out. Doesn't matter too much anyway since the Santander deal will go ahead regardless.

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It's not that bad really, at least they made some profit

a £23.9m net loss reported as a profit by the British press = a £2m profit coz it must be innit?

Edited by gruffydd

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No No No - you're off message - Santander is a sensible bank that only makes good business decisions and can always be trusted - repeat after me...

No No No - you're off message - Santander is a sensible bank that only makes good business decisions and can always be trusted - repeat after me...

No No No - you're off message - Santander is a sensible bank that only makes good business decisions and can always be trusted - repeat after me...

No No No - you're off message - Santander is a sensible bank that only makes good business decisions and can always be trusted - repeat after me...

Am I supposed to do the repeating with irony?

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Alliance & Leicester, the UK mortgage bank which is under offer from Santander of Spain, just scraped through to report a first-half profit after writedowns to its treasury assets and higher funding costs. The group reported a statutory pre-tax profit of £2m (a 23.9m net loss!!!!)

http://www.bloomberg.com/apps/news?pid=206...Bw&refer=uk

So there is some truth in the rather terrifying rumours sweeping the City at the moment!

So why exactly are they making a loss?

These kind of places were making 10's of millions of pounds just a couple of years ago. What exactly has changed so drastically - presumably they are still making money from the mortgages that are outstanding? Or have their margins been cut so slim.

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So why exactly are they making a loss?

These kind of places were making 10's of millions of pounds just a couple of years ago. What exactly has changed so drastically - presumably they are still making money from the mortgages that are outstanding? Or have their margins been cut so slim.

they never 'made' millions of pounds. it turned out.

they 'would' have made millions of pounds if everybody would have remained blind to the fact it was a housing 'bubble' and was not normal.

so the're sunk now.

i dont see them being able to recover as their loan book goes from worse to even worse.

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When I read this news I wasnt suprised, its not unusual for a company under offer to make massive write downs, especially if the offer is likely to be accepted.

They wouldnt of wanted to put these write downs through before the offer was announced and they definetly wouldnt of wanted to wait until after Santander are in control, so now is the ideal time.

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they never 'made' millions of pounds. it turned out.

they 'would' have made millions of pounds if everybody would have remained blind to the fact it was a housing 'bubble' and was not normal.

so the're sunk now.

i dont see them being able to recover as their loan book goes from worse to even worse.

So this 'loss' is an indication of people defaulting on loans or is it based on the value of the mortgaged properties on thier books falling in price?

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So this 'loss' is an indication of people defaulting on loans or is it based on the value of the mortgaged properties on thier books falling in price?

from my basic grasp (and its basic) they aimed to have all these loans paid as it wasnt a bubble, it was sensible lending. but it was a bubble, a big bubble and people started to default, so inter bank rates changed and the profit they thought they were going to get didnt arrive. it stood still, while the rates they paid for the money they lent out rose. eating profits. = treading water on a knife edge.

this is before the uk btl books fall apart and dies - or the recession effects of inflation on the interest rates and employment.

thats the neat bit to come.

to save the banks and stupid borrowers like landlords with portfolios they have to sacrifice the £s global value.

we all WILL at some future point pay for all of the treats btl landlords made and got away with. most are now trapped.

northern rock alone has cost twice the annual entire defence budget to save - and we havent even got into full crash speed yet.

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How many job losses will there be when Santander take over B & B and A & L I take it they will both be merged with Abbey ?

If A & L are making a small loss, wonder how big B & B's will be , does anyone know when B & B's figures are due ?

Edited by miko

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The confusion will be because of the 'accounts profit' - the one most people understand.

And the 'Profits chargeable to corporation tax' or PCTCT.

Their accounts profit could be £2m. But the tax man has some funny laws and regs, and A&L may pay tax on a PCTCT of say £30m. It means that overall, despite an accounts profit, they will be making a loss due to the tax bill.

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How many job losses will there be when Santander take over B & B and A & L I take it they will both be merged with Abbey ?

Take one established Santander IT system, roll it out to the 10% of A&E branches that are in locations where Abbey aren't, and then close the other 90% and shut the A&E head office in Leicester or Alliance or wherever.

Oh, and if you think that there will be a net increase in Abbey customer facing or back office jobs, try calling their call centre and see if you can work out what accent "David" answers with.

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The confusion will be because of the 'accounts profit' - the one most people understand.

And the 'Profits chargeable to corporation tax' or PCTCT.

Their accounts profit could be £2m. But the tax man has some funny laws and regs, and A&L may pay tax on a PCTCT of say £30m. It means that overall, despite an accounts profit, they will be making a loss due to the tax bill.

nah its things like add backs

depreciation

donations

staff entertaining over £150 a person

customer entertaining (ie bungs)

goodwill amortisation

that sort of thing....

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Take one established Santander IT system, roll it out to the 10% of A&E branches that are in locations where Abbey aren't, and then close the other 90% and shut the A&E head office in Leicester or Alliance or wherever.

Oh, and if you think that there will be a net increase in Abbey customer facing or back office jobs, try calling their call centre and see if you can work out what accent "David" answers with.

Mr Paddles posts at 1126 and then is silent until 1936.

Not enough time to travel back to London from Edgbaston.

He's been charging the client for watching the cricket and quaffing booze all day.

p-o-p

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Take one established Santander IT system, roll it out to the 10% of A&E branches that are in locations where Abbey aren't, and then close the other 90% and shut the A&E head office in Leicester or Alliance or wherever.

A&L head office is very nice building in Narborough just south of the city of leicester....build on the very same spot of the former Mental Hospital...'The Towers'. :lol:

ps its true !!!

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  • 395 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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