The 'Crew of Fools' Bidding to Steer B& B out of Trouble ; ANALYSIS

By Goodway, Nick | The Evening Standard (London, England), June 6, 2008 | Go to article overview
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The 'Crew of Fools' Bidding to Steer B& B out of Trouble ; ANALYSIS


Goodway, Nick, The Evening Standard (London, England)


TAKING over the day-today running of Bradford & Bingley this week, Rod Kent declared: We have got to up the management game here." Given the former building society's profit warning, cut- price rights issue and private-equity cash injection, its chairman could hardly be accused of understatement.

The departure of chief executive Steven Crawshaw on the grounds of ill-health throws the spotlight on Kent and his team of non- executive directors.

They are the people who take responsibility for the business on behalf of its owners the 850,000-plus private shareholders and the pension funds and insurance companies in the City that guard our pensions and savings.

B& B launched its original [pounds]300 million rights issue on 14 May, a month after it told the Stock Exchange it was "not intending to issue equity by way of a rights issue". Ten days later, Kent and the rest of the board received the management accounts for April. They told a very different story to the last trading update, which had been referred to in the rights-issue release. B& B had actually lost [pounds]8 million in the first four months of the year against profits of [pounds]107 million a year earlier.

Kent has said the board does not want to "dodge its responsibilities". But he has also called for "a greater sense of realism and greater sense of urgency".

Candidly, he added: " We may be fools, but we are not knaves." So who are these fools?

Rod Kent, 61 Career merchant banker who became chairman of B& B six years ago. His City credentials are strong, although shares in Close Brothers, which he also chairs, have slumped by more than a third since it rejected a takeover bid earlier this year. He also chairs the Duke of Westminster's Grosvenor and the BT Pension Scheme Trustees. A sports fan, he owns a dairy farm in Berkshire and restores antique furniture.

Michael Buckley, 62

The former chief executive of Allied Irish Banks only joined B& B last July, but must be pretty busy at the moment.

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