JOBS

Peter Edwards

BRADFORD & Bingley's jobs in Yorkshire should be protected before those in other parts of the country after its "tragic" nationalisation, said the MP whose constituency includes its headquarters.

Philip Davies, Conservative MP for Shipley, which includes the lender's Bingley base and its Crossflats office, called on the Government to give priority to workers in this region in way that Lloyds TSB had sought to safeguard Scottish jobs after its £12.2bn takeover of Halifax Bank of Scotland.

The nationalisation of loss-making B&B, expected to be confirmed before the stock market opens this morning, will end more than 150 years of independence and has prompted fears of major job losses in the region. Earlier this year mortgage lender Northern Rock announced plans to axe 2,000 jobs – about a third of its staff – after it was nationalised but many will remain in the North East.

Mr Davies said yesterday: "As the Government attempts to retain Northern Rock jobs in Newcastle and then HBOS jobs in Scotland I want to see them protect B&B jobs in Yorkshire.

"You cannot underestimate the importance of B&B to the local economy. Any job losses will have a very major impact.

"The employers must be worried sick. Everybody who works there will feel their job is at risk."

Heavy job cuts by B&B would have a dreadful effect on West Yorkshire as it tries to come to terms with the takeover of HBOS, whose retail division is based in Halifax, he added.

Last week Lloyds TSB bosses refused to give guarantees over the future of thousands of HBOS jobs in Yorkshire after talks with the Government, although staff have been told "the majority" are likely to stay. HBOS chief executive Andy Hornby has said some job reductions are "inevitable".

Mr Davies said: "The effect of HBOS and B&B together could have a devastating effect on West Yorkshire. It's incredibly sad as it is people's jobs.

"Bradford & Bingley has a fantastic heritage in the area and it is absolutely tragic to see it in the state it is in."

He said he would have preferred to see a Bank of England-led reconstruction package, as proposed by Shadow Chancellor George Osborne.

Ann Cryer, the Labour MP for Keighley, said her constituency had people who worked for HBOS in Halifax as well as many B&B employees.

"My constituency in my view is very vulnerable in the present economic climate," she said.

Ms Cryer said she would be "delighted" if B&B were nationalised. "I much prefer nationalisation to instant death, which is what has happened with some of the American banks and what do you feel if that is your constituency and hundreds of jobs are just gone in minutes?" she said.

"It is just a time-keeping measure to ensure jobs. They just have to put it on hold for a bit to ensure all those jobs at Bingley."

She said she was worried that the area had been overlooked during discussions about the planned Lloyds TSB takeover of HBOS. "Everybody seems to be concerned with saving jobs in Edinburgh but I am concerned with Halifax," she said.

Ms Cryer said she believed Lloyds TSB may outsource some jobs to India and that B&B workers could face the same threat.

"I do not want the Government selling off bits of Bradford & Bingley to companies who in turn are moving jobs offshore to India," she said.

The UK Shareholders' Association criticised the Government as well as the board of B&B.

Spokesman Roger Lawson said the £400m rights issue had been designed to prevent the need for such a bailout. The cash call concluded in July, after being restructured twice, with only one-in-four shareholders taking up their options, leaving the underwriters with a massive bill.

"I cannot see how it has changed in just two months. The money raised was supposed to last for a year or two. It does not make sense for the company to claim they are in an impossible situation (now]."

Mr Lawson said the UKSA may ask the Financial Services Authority to investigate the rights issue to establish whether it had given a full picture of the financial state of B&B.

He also said of the decision to nationalise: "It is a typical Labour Party approach. Why are the directors going along with it? They are not consulting shareholders. Shareholders will end up with nothing."

Kris Hopkins,Tory leader of Bradford council, said he was "extremely concerned" that local people would suffer.

He said the city had a "significant number" of HBOS employees who had already seen several weeks of uncertainty.

"We have seen two major banks which are based in the district, or are very close to it, be undermined. We have got to think about the local impact."


Bowler-hatted city gents were a symbol of successful merger

HISTORY

Andrew Robinson

IT HAS been a bank for only eight years but Bradford & Bingley's roots go back more than 150 years.

Before it was listed on the London Stock Exchange in 2000, it was one of Britain's best known building societies, with its distinctive logo of two bowler-hatted city gents – Mr Bradford and Mr Bingley.

Using the two characters was a nod to the 1964 merger of the Bradford Equitable Building Society and the Bingley Building Society, two West Yorkshire institutions established in 1851 to help local people save and get loans, often to buy a home.

By the early 1960s the Bradford had 22 branches and the Bingley had more than 30. Their amalgamation in 1964 created the nation's eighth largest building society.

The characters of Mr Bradford and Mr Bingley were created and remained for more than 30 years.

Legislation in the 1980s allowed banks to offer mortgages, which had traditionally been the preserve of building societies, but also allowed the societies to extend their services.

Building societies were also allowed to abandon their mutual status and some, including Abbey National, did so quickly. Woolwich, Alliance & Leicester, Halifax and Northern Rock followed suit.

Bradford & Bingley stayed as a mutual but took advantage of new freedoms to shift focus to include retail services including offering financial advice.

By 1999, it was the second largest building society in Britain, with 2.5 million members and specialised in mortgages for the buy-to-let market.

In July 2000 its voting members overwhelmingly endorsed a proposal from the board of directors to convert to a public limited company, Bradford & Bingley plc.

Two years later, the bank's image was updated when advertising agency M&C Saatchi retired Mr Bradford and Mr Bingley and gave their bowler hat to a young woman in a green suit.

She whispers "Aren't hopes and dreams fragile? But they could happen with Bradford & Bingley."

Its message is aimed at first-time buyers, the self-employed and those who want to buy a property to rent out.

But now the bank, which was the eighth largest lender of new mortgages in Britain last year, is looking rather fragile itself.

In February it announced that its annual profits had slumped by half and reported a steep rise in mortgage arrears and bad debts.

The collapse of the mortgage market has seen its share price fall sharply in recent days and 370 of its 3,000 staff have lost their jobs.