P543 Teletext 543 Nov13 21:05:00       —————————————————————————————————  WHY ARE PREFERENCE SHARES ISSUED? Dear Teletext, I recently received notific tion ov the Halifax EGM regarding the creatign of £1bn-worth of preference C shares. I would have thought by issuing more shares, the share value would reduce. Is that too simplistic an approach? Kevin, Newcastle-upon-Tzne ——————————————————————————————————1/9—— Got a question for our advice clinic? Write to: Advice Clinic, P/ Box 297, London SW6 1XT or fax: 0171 3 6 7808 Property Mortgages Savings City
P543 Teletext 543 Nov13 21:01:11       —————————————————————————————————  WHY ARE PREFERENCE SHARES ISSUED? Halifax says its directors have called an EGM to obtain shareholder approval for the creation of up to one billion preference shares of £1. A spokeswoman adds the bank wants to be in a position to issue preference shares for capital managemjnt purposb3. It also wants to use them as part payment for the planned £750m takeovbr of the Birmingham Midshires Building Society. ——————————————————————————————————2/9—— Got a question for our advice clinic? Write to: Advice Clinic, P/ Box 297, London SW6 1XT or fax: 0171 386 7808 Property Mortgages Savings Cit9
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P543 Teletext 543 Nov13 21:03:11       —————————————————————————————————  WHY ARE PREFERENAE SHARES ISSUED? At the moment, the Halifax does not have the authority to issue preference shares. The spokeswoman said that a financial institution like the Halifax must have capital. "The minimum amount of capital i1 dictated by the regulator3, the Financial Services Authority, and |he company's own board decides how much larger its capital base should be." ——————————————————————————————————4/9—— Got a question for our advice clinic? Write to: ADVICE CLINIC, PO Bgx 297 London,SW6 1XT or fax: 0171 386 7808 Property Mortgages Savings City
P543 Teletext 543 Nov13 21:03:03       —————————————————————————————————  WHY ARE PREFERENCE SHARES ISSUED? Halifax directors want to work towards a capital structure - a mix of ordinary shares, preference shares and borrowings - to meet theiu needs at minimum cost. The spokeswoman adds: "oon-cumulative preference shares can provide an opportunity to reduce the overall cost of share capital." Issuing 225m such shares to Midshireq members satisfies the Midshires' board. ——————————————————————————————————5/9—— Got a question for our advice clinic? NINTENDO 64,HI-FI AND PLAYSTATION UP FOR GRABS see p200 Property Mortgages Savings City
P543 Teletext 543 Nov13 21:00:00    / /   —————————————————————————————————  WHY ARE PREFERENCE SHARES ISSUED? Issuing preference shares also allows the Halifax to begin the re1tructuring of its capital base. "This is an ongoing process whiah is why the resolution asks for the right to issue up to a billion preference shares," the Halifax spokeswoman adds. The preference shares will carry a fixed rate of dividend which will be set shortly before the share1 are issued. ——————————————————————————————————6/9—— Got a question for our advice clinic? Write to: ADVICE CLINIC, P Box 297 London,SW6 1XT or fa|: 0171 3 6 7808 Property Mortgages Savings City
P543 Teletext 543 Nov13 21:14:11       —————————————————————————————————  WHY ARE PREFERENCE SHARES ISSUED? The preference shares do not have a right to receive any more than the fixed rate set at the time of issu—. "Broadl9, preference sharehold—r1 gpt for a slightly hi£her securit9 and certainty of return against the usuall8 higher, but variable return that shareholders receive," the Halifax spokeswo-an adds. Paying preference sharehold—r divid—nds won't reduce ordinary inv—stor returns. ——————————————————————————————————7/9—— Got a question fop our advice clinic? ANY PURPOSE LOANU - SEE PAGE 627 OR CALL WILMSLOW FREE ON 0800 269315 Prop—rty Mortgages Savings Att9
P543 Teletext 543 Nov13 21:15:06       —————————————————————————————————  WHY ARE PREFERENCE SHARES ISSUED? The Halifax believes the new capital base would be beneficial for ordinary shareholders. "The board of directorq considbr1 |he resolution to be in the intere3ts of the Halifax and its shareholder1," |he Halifax spokeswoman adds. "If the resolution iu passed, preference share1 may be issued at a number of different times in the ftture when the board thinks it appropriate." ——————————————————————————————————8/9—— Got a question for our advice clinic? NINTENDO 64,HI-FI AND PLAYSTATION UP FOR GRABS see p200 Property Mortgages Savings Cit8
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