FSA launches insider dealing investigation for UK bank
LONDON – The UK Financial Services Authority (FSA) is investigating alleged insider dealing at Bradford & Bingley, according to a report in the Daily Telegraph.
The UK bank has been suffering from the fallout of the US subprime crisis and ensuing credit crunch. It issued a profit warning earlier this week, and has been forced to sell 23% of its stock to a US private equity house, Texas Pacific Group, at a heavily discounted price. The bank’s chief executive also recently resigned due to a heart complaint, amid rumours of mismanagement and liquidity concerns.
The FSA will probe apparently suspicious share sales last week. The bank's shares fell by 8.5% last Thursday and a further 7.5% on Friday, before the Texas Pacific shares purchase and the profit warning was made public.A spokesman for the regulator confirmed that Bradford & Bingley was under investigation.
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