NBNK loses £23m while buying nothing

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The Independent Online

NBNK Investments, the shell company that was set up by Lord Levene to buy high street bank branches, yesterday admitted it crashed to a £23m loss last year as it ran up big costs without actually purchasing anything.

The chief executive Gary Hoffman earned almost £2.8m – £910,000 in salary and benefits, plus a £1.85m "golden hello", after he quit his previous role at taxpayer-owned Northern Rock. Ironically, NBNK incurred some of its costs in its failed bid for Northern Rock's branches, which were bought by rival bidder Virgin Money last November.

NBNK also recruited "third-party advisers" and "temporary expert staff" to do a "great deal of careful planning" in its so-far unsuccessful effort to buy 632 Lloyds branches.

The annual report said NBNK had operated in an "efficient and cost-conscious manner to keep the quantum of our loss in 2011 down to £23.3m" – against a £1.3m loss a year earlier. NBNK's many advisers included UBS, Royal Bank of Scotland, lawyers Slaughter & May and PR firm Pelham Bell Pottinger.

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