Northern Rock Share Discussion Threads

[onsider] 14/1/2009 18:29

Is the leak part of the case? Is there a chance he could be called to give any kind of statement?

[bryan2] 14/1/2009 17:53

Strange how quiet the BBC is on the court case.
When the run on the Rock was happening Peston was all over the News items!

[dairyhick] 14/1/2009 15:57

wot rhymes wiff cluck, mate? well avsum, geddit?

[cpl593h] 14/1/2009 15:27

bryan2 - you really are mentally ill ('scuse the split infin).

Britain 2009 - BAILmeOUT NATION.

[magician2001] 14/1/2009 12:28

Onsider, thanks for the reply. I am ever the optimist :-)

[onsider] 14/1/2009 11:05

Magic, this is purely about the compensation order and how the basis for compensation calculation was set.

A value will not come out of this hearing, only the legality of the actual order is to be judged.

Assuming the shareholders win, then any evaluated compensation value may need to be re-valued.

If you read the letter from the valuer, he has stated that he is going to value now and, if required, will adjust that value should the court case require a change in the parameters...

Basically, I doubt we'll see a penny... Wrote mine off last February as a bad job...

[onsider] 14/1/2009 11:01

Or just a foul way of expressing yourself, heh dairy.

[magician2001] 14/1/2009 07:30

Can any of the more sensible posters here tell me, is this court case to establish a valuation for the rock? or to appeal against the basis of the valuation? or both?

Regards

Magic

[dairyhick] 13/1/2009 22:41

grbaker - only if you have a dirty mind, mate.

[dairyhick] 13/1/2009 22:40

only if you have a dirty mind mate.

[montyhedge] 13/1/2009 19:22

Hope you boys get something, Gov paid out the bond holders.

[bryan2] 13/1/2009 13:34

The court case latest.
Courtesy of Jamtastic Interactive Investor site.

THE Government was accused in court today of setting up a "nil compensation" scheme for Northern Rock shareholders when the bank was nationalised a year ago.
Shareholders' lawyers told the High Court that the "unfair" scheme was based on false criteria which would lead to shares being valued at zero – even though the Government had run no financial risk to itself or the public when it bailed out Northern Rock.

The legislation on which compensation assessment was based "does not provide for a compensation scheme – instead it provides for a no compensation scheme," said Lord Pannick QC, for the bank's biggest former investor, SRM Global.

And that, he said, amounted to a breach of the human rights principle that the taking of property by the state must be balanced by compensation reasonably related to the value of that property.

In a judicial review hearing set for four days, shareholders are seeking a declaration that the compensation provisions are incompatible with the European Convention on Human Rights.

If the Government loses at the end of the judicial process, it would be forced to reconsider the terms of reference given to independent valuers BDO Stoy Hayward so as to reflect what the shareholders say is the true value of their shares – at least £3 per share and probably much more.

The Government contends that the Treasury and the Bank of England provided substantial financial assistance to Northern Rock – £27 billion in loans and a £29 billion guarantee fund – without which it would have gone into liquidation.

Therefore, it argues, the shares should be valued on the basis of what they would have been worth without the financial assistance.

But Lord Pannick told Lord Justice Stanley Burnton and Mr Justice Silber that Northern Rock was a solvent business with a strong asset base, albeit with short-term liquidity difficulties.

The Treasury and the Bank of England had provided assistance "at penal interest rates designed to cover any risk being born by the Government".
"Northern Rock was not a charity case – it had to pay a penal rate for the support it received," he said.

Chancellor Alistair Darling and the Treasury repeatedly stated that the Government was not taking any risks because it was satisfied the loans would be repaid and the guarantees would not be called upon. There was "no cost" to the taxpayer.

The Government had announced it intended to sell the bank back to the private sector for a substantial sum when market conditions improved.
In all those circumstances, it was inconsistent with the principle of "fair value" compensation for the State to take 100% of the value of the assets that ended up in its ownership, Lord Pannick said.

The full article contains 459 words and appears in The Scotsman newspaper

[proothi12] 13/1/2009 12:15

The case is scheduled to last for three-and-a-half days with the final decision due in six weeks. Angry demonstrators, mainly from the North East, have taken to the streets of London to vent their anger.

[diydan] 13/1/2009 10:57

proothi12
No it will be many weeks before the result comes out. the 3 1/2 days is just to put the case. The judge then considers it and gives thier view.

Those against compensation should maybe remember that though they may not have held NR shares directly they will have held them in a pension fund or any stock based investment fund such as endowments. So compensation will be important to almost everyone in the UK. Also given BB. going through compensation issue and in time most UK banks will be nationalised it is likely going to be very important to everyone that a fare level of compensation is payed.

[proothi12] 13/1/2009 10:21

with regards to the trial, 3 and half days, will we therefore know the outcome by friday. Anyone still here to help answer this......

[ajmace] 11/1/2009 19:20

interesting article in the Sunday Telegraph today:

[dairyhick] 11/1/2009 17:59

I think we should be told! LOL
by whooooom? LALLY

[bryan2] 11/1/2009 16:39

cpl593h

Just so that other contributors know where you are coming from; cpl593h first came to my notice in another bank thread.
He or she urged me not to initiate discussions around a particular point but to put any comments into the general heading.
Further in a comment in the RBS category he claimed to have inside knowledge of the internal operations of Northern Rock.
This is strange because as far as I know cpl593h has not made any comments about NRK before Dec 2008.
I wonder why he/she is so keen to shut me up.
Is it possible that he/she works for HMG/BoE?
I think we should be told!

[simon cawkwell] 11/1/2009 07:06

Gentlemen,

I have not seen Ms Godbehere's contract. But if it was in her name with NRK and the services were rendered in the UK (and if not in the UK, where else?) her remuneration would surely have been taxable as UK source income and taxed as if she were domiciled in England. The non-dom feature of her status would have been irrelevant.

Simon Cawkwell