Two of the UK’s smaller mortgage lenders yesterday moved to reassure investors that they could fund themselves until next summer, in spite of concerns about the continued credit squeeze. Financial Times, Daily Telegraph, The Times
Alliance & Leicester and Bradford & Bingley have seen their shares fall by 40% this year amid worries that they could face funding difficulties similar to Northern Rock’s.
Yesterday A&L said it was able to fund itself until the third quarter of next year after taking out new liquidity facilities, including one for more than £4bn arranged by Credit Suisse.
A&L shares yesterday jumped 8% to 686p. T
B&B gave a similarly reassuring statement, saying it would fund itself until next year and that 2007 pre-tax profits would be in line with expectations. Its shares rose 0.1 per cent to 303p. B&B has raised £2.5bn from private placements and last week announced it would receive an additional £4.2bn from the sale of two loan books.