Standard Life Demutualisation

Erm....Congratulations?

Badass.

As bribes go, it's an insult. So vote to stay mutual.

By the way, what was the threshold again?

75% of members to vote yes, or 75% or the votes cast to be yes?

If the latter, it is important that those who are not in favour should make the effort to vote No, and not just to throw their voting papers in the bin.

The important thing is what do you think? They're your shares.

I think that the only way for that company is up so I'll be keeping mine. I hope they get taken over ASAP.

Mutuality may be a good concept on paper but Standard Life during the stock bear market found it wanting. Likewise with the various demutualisations in the 1990s after the property market downturn - they look okay during the boom times but the mask is ripped off during the bad times.

That's why I expect high flying Nationwide to be forced into demutualisation after the next sizeable correction in the UK property maket.

Roland.

In message , Roland Watson writes

Do you think that was SLs fault? What about the FSA telling them to disinvest in equities just before the upturn? SL were (AFAIAA) the only W/P company to borrow against their Equity Portfolio in order to meet cash requirements whilst the market was low, but the FSA stepped in and told them to stop it, at the worst possible moment. So what did they have ti invest in instead? Yes, you've guessed, Government Stocks!

??? InsCos or B/Socs? Was it the so called 'downturn' or the dergulation of B/Socs which also happened at the same time. AIUI they b/socs demutualised so as to raise market capital and to enable them to borrow more to fund further lending.

Ok, a bit like HBOS & Northern Rock??? B&B havent done well but that was due to an obviously flawed business model. Abbey had crap management.

Why will that happen? Why will they need market capital?

I got 546, nah nah na na nah!

Of course it was their fault, they weren't the only ones who had to get in line so that is no excuse.

Once again, they weren't discriminated against in that situation. They didn't have the ability to cope.

I agree, they shouldn't have had to, but you're not implying the FSA had it in for SL?

I said "various" not "all".

1995 was deregulation which was just after the property market hit bottom? I suspect the two events are not unrelated. You can't tell me the shock of that property market had *nothing* to do with building societies demutualising.

Probably because they lost so much capital from defaulters and borrowed against the expectation of more good time for real estate which never came.

Halifax and Northern Rock demutualised in 1997 before the 2000-2003 bear market. So they were not mutuals during the time under discussion.

demutualisation

Too many underperforming loans/mortgages on their books.

I don't when it will happen, I merely present it as a likely situation.

Roland.

In message , Roland Watson writes

Not so. They were the *only* company who stayed in equities and borrowed against the portfolio. About £8bn of borrowing I think. Show me another who did that?

Thats true, but the FSA didnt take account of SLs position.

Eh? If they had stayed in equities the situation would have been quite different today.

No, not at all. They just interfered with everybody.

I cant see how it effected the b/socs under their old regulation system. After deregulation the traditional clearers and wodges of other non-b/soc mortgage lenders entered the market applying far stiuffer competition.

The bigger societies, i.e. Halifax, Abbey, A&L etc., had been crying out for years to be able to raise capital on the markets, so ti wasnt as though it was brought in quick.

I note the use of the word 'probably'.

In fact provisions for bad debts have not been a problem for any B/Soc in modern times except the Leamington Spa and the Town & Country, but in both cases that was due to reckless lending.

Eh? B/Soc borrowing regs wouldnt have allowed that to happen!

Perhaps an example of one that does fit your scenario then?

'Underperforming'?

Hmm. A drop in house values does not predict a splurge of debt provisions, that only happens when borrowers cant afford to pay. Nationwide still cover their higher LTVs with Indeminties, so I cant see that happening.

So what, I got 739! ;)

Ah, but I got mine for nothing! (I contracted out of serps for a year when the Government was pushing it back in around 1990). I made no voluntary contributions, and went self employed after 2 years of it. So my serps is worth about £9k in SL plus the value of the shares. Am I the only one who has MADE money out of SL's with profit scheme? ;-)

Actually, the ironic thing is that SL have been writing to me every year for about four telling me I should put the money back into serps. Glad I didn't take them up on it!

same here.

(1073 if there's a competition)

tim

Any idea of the expected range of prices of the shares?