any comments, thoughts, on this stock.

Fund manager on Working lunch programme suggests holding on to these for the longer term ! Not convinced she is correct but then w.d.i.k.

Getting on TV sounds like a great way to stop everyone selling their shares while the fund you manage sell theirs :-)

ttt

the ordinary shareholders will get peanuts in any capital reconstruction - nrk will survive but buyers at 170p might do better at the races

May still be able to recoup some losses shorting it later..... The yanks are finally coming up with credit facilities to the Rock, wonder whats changed in the last few weeks when Northern Rock was unable to get any credit facilities forceing it to go to the BoE.... Maybe not such a bad deal after all.... Crashed out when stop loss hit at a mega low 115, the upper bracket of my 5%... Not seen the price since, definatly worth waiting for rather than try and trade the day..

people people people ..

The NRK problem is simply one of funding, i.e. how easily it can borrow money, there is nothing wrong with the bank, there is nothing wrong with the book,

The only problem here is that nowadays its difficult to borrow money, so they went to the bank of england,

remember NRK was running on 80% money market funding when the share price was 12 .. it wasnt a problem then ..

Also this credit crunch we have going is not going to last forever .. people will start lending again ... and then things go back to normal "kinda"

Now the book, the NRK book is a prime book, why the hell would anyone discount a prime book,

Problem here is that everyone has panicked .. and they have panicked good and proper .. there is panic and there is fear and when you have those you have tankage of the share price,

balugaa,

Now the book, the NRK book is a prime book, why the hell would anyone discount a prime book,


Because much of it was at long term fixes, very aggresively priced, as low as 4.69% for 15 years, and because the underwriting allowed for up to 5 times joint income and self certification to 85% LTV.
Not only is it more exposed than most to an economic downturn, but the book would not even be profitable on those rates.
As I said before though, there are areas of the book that are actually quite attractive, the question is can NRK avoid a fire sale, where the attractive bits would go cheaply and the unattractive bits would have an even bigger discount.
Alan

i think this is what is missed,

It doesnt matter how aggressively priced it is, it doesnt matter what factor of joint income you lend, the point here, is that how likely are the borrowers to default ..

that is the question, if the answer is not very likely (aka prime book) why the discount?

Now wrt economic downturn, everybank has been been lending at those levels, over the past few years, so the problem then will be a sector one not a NRK one ..

I guess the question is whether or not i would buy them, i did buy some at 3 would i top up .. hell no ..

NRK does look much much stronger over the past 1 week.

It may be a prime book, but that depends on your definition of prime!!
85% LTV self cert is not prime. 5 x joint income is not prime, and as for the rates for long term fixes, they were top of the pile for a long time, by quite a distance in some cases.
IF their is a downturn, and IF householders feel the pinch, then undoubtedly the sector will suffer, but the NRK book may be the first to be cut and probably the deepest.
After all, what would you pay for loan notes to individuals at 4.69%, when you have to collect it, risk defaults, the security is shaky and the loan was made at a very generous 5 x income? Remember, this is fixed for 15 years but if rates drop significantly, most will be repaid early, and currently you can stick your brass in ING and get 5.25%!!!
Alan

yes but you forget that that 4.69 rate has been offloaded elsewhere, all thats left is that you owe me .. x amount of cash, .... and as long as you keep paying it, im a happy bunny ..

The way it works from my understanding is this, they lend you the money they charge you a rate, they then take that rate is sell it off as some structure, probably paying 4.67 everytime you pay them they keep the 2bps and send the rest forward ..

Surprised no one on here talking about Panorama Programe today.

still holding a small stake at 3 ....if....if it gets through this... betting/guessing? on 5 plus longer term....anybody concur? or is this just wishful thinking?

I've been out of the loop for a week.

How it can all change, eh? ;-0

General Motors UK retail arm for financial services (GMAC-RFC) have just announced the closure of its heavy sub prime business, High Street Home Loans.
They will still operate as GMAC, but this is for minor sub prime.
Alan

Where is everybody?Stock jumps up 26% to 2.61 and nobody has a word to say.
All i can say is nobody knows what the price of these shares should be at.

your last comment is spot on ..... the bears must feel like heretics at the stake!

Cynic, SHORT now at 260p!


Northern Rock declines comment on rumoured bid approach as share price soars - AFX


LONDON (Thomson Financial) - Northern Rock declined comment on whether it has received a bid approach following speculation in the market that sent the beleaguered mortgage lender's share price soaring.

At 10.50 am, the share was up 50 pence or 23.8 pct at 257 pence.

A week ago you would have been "shot down in flames " to suggest that this price may be reached. Lemming effect at work it would appear.