Hundreds of thousands of investors in Halifax Bank of Scotland and Bradford & Bingley face crunch decisions on whether to take up more shares in their banks.

B&B had to be rescued last week by Britain’s six biggest banks after American investor TPG pulled out of a deal to invest £179m as part of a £400m rights issue. The buy-to-let lender is pressing ahead with the issue and will send out an alternative prospectus to its 850,000 shareholders within days.

More than 2m investors in HBOS, which owns Halifax, Britain’s biggest mortgage lender, have also been asked to take up more shares.

Stockbrokers said small shareholders were waiting until the last minute to decide whether to take part in the £4 billion rights issue.

The deadline for payment and for acceptance of the rights issue is Friday, while those who hold shares in nominee accounts have until Tuesday.

We advise what to do if you are a saver or a shareholder.

BRADFORD & BINGLEY SHAREHOLDERS

According to B&B’s website, shareholders will receive a supplementary prospectus with key dates for the rights issue in the next “few days”.

The bank’s shares have been branded “worthless”, but they gained 5% on Friday to close at 47p on speculation that a “white knight” would rescue the troubled lender.

Nonetheless, brokers are advising B&B’s shareholders to decline the invitation to buy more shares.

Shareholders have been offered 19 shares for every 25 they own at a rights issue price of 55p — above Friday’s closing price and therefore not worth taking up.

Richard Hunter, of the stockbroking arm of Hargreaves Lansdown, added: “The broad market opinion is against the B&B offer. As Britain’s biggest buy-to-let lender, which leaves it very vulnerable to shocks to the UK housing market.”

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