Former B&B chief 'massively sorry'for demise of lender

The boss of Bradford & Bingley issued a public apology yesterday as he told a Commons Treasury Select Committee hearing that nationalisation had been the only option after a run on his bank. The former Bradford & Bingley chairman Rod Kent apologised for his management's role in the lender's demise and said the bank's board "accepts it is fully accountable for what happened" and was "massively sorry".

Its chief executive, Richard Pym, meanwhile, blamed the media for playing a part in the panic that led to the lender's demise.

Related articles

• Brown pledges to boost bank lending
• Brown pledges tax cuts to soften downturn
• Today in Politics: Cameron U-turn on tax and spend
• Steve Richards: The recession has forced Cameron to revive the failed policies of old
• Downturn sees sharp rise in wage freezes
• Protest ahead of HBOS takeover vote
• Tories cut spending plans as poll lead slumps to 3 points
• Hamish McRae: Recessions serve a useful purpose
• Banks charge more for new mortgages
• Sharp fall in inflation as food and petrol prices dive
• David Prosser: Deflation is scary. So too is a policymaker in a blind panic
• David Prosser: The Chancellor's not-so-subtle HBOS message
• Credit crisis diary: Look at all those beautiful white teeth
• Search the news archive for more stories

The Bradford & Bingley executives revealed that customers had withdrawn almost £300m from the lender in the two days before it was nationalised. The company was "over-run" by the withdrawals, according to Mr Pym.

On 25 September, the bank had said it was "strongly capitalised". Two days later, the company was told that its capital position did not meet levels required by the Financial Services Authority. Mr Pym said the B&B statement was accurate at the time and that customer panic was fuelled by reports the following day suggesting that government aid was planned.

Meanwhile Northern Rock, which was nationalised in February, denied that it is forcing customers from their homes to repay government loans. "The link between repossessions and repayment of government debt is non-existent," the chairman, Ron Sandler, told MPs at the hearing. He added that the bank has faced no government interference.

Revenue from home evictions has totalled only 1 per cent of Northern Rock's repayments, he added.

The Government led a £24bn bailout of the mortgage provider in February. Last month, the bank said it had repaid 57 per cent of the debt and still owed £11.5bn. Mr Sandler said that only 3 per cent of customers who had signed up to Northern Rock's 125 per cent mortgages are in arrears.

The testimony came as the Chancellor, Alistair Darling, appeared to undermine attempts to scupper the government bailout of HBOS which includes a merger with English rival Lloyds TSB. Mr Darling said there was "no automatic right of access" to the recapitalisation scheme offered to banks last month.