northern rock 2

8/9/2019 Northern Rock 2

1/19

Independent Valuation

under the Northern Rock plc Compensation

Scheme Order 2008

Final Document

March 2010

by Andrew Caldwell

Independent Valuer appointed under Part 3 of the Northern Rock plcCompensation Scheme Order 2008


2/19

Table of contents

Chapter

1. Introduction

Purpose of this document

Reconsideration

Shareholder register

2. Summary of responses to the consultation

Summary of representations

3. The effect of these representations on my provisional views set out in the Consultation Documen

4. My final determination as to the amount of any compensation payable by the Treasury


3/19


4/19

Independent Valuation under the Northern Rock plc Compensation Scheme Order 2008Consultation document | March 2010

the effect of those representations on my provisionalviews set out in the Consultation Document; and

my final determination as to the amount of anycompensation payable by the Treasury.

Reconsideration

1.10. Any person who is affected by the determination set out in anAssessment Notice may seek reconsideration of thedetermination within 5 weeks from the date of the

Assessment Notice, i.e. no later than 4 May 2010.

1.11. Any such request for reconsideration should be submitted tome, together with any evidence you wish to submit to

support your request, as follows:

by post to Andrew Caldwell, Northern Rock Valuer,BDO LLP, 55 Baker Street, London, W1U 7EU; or

by email to [email protected], noting yourpostal address.

1.12. Where a request for reconsideration is made, I shallid d t i ti d th i R i d

notification that thbeen upheld or var

the amount of anybeing payable; and

the reasons for my1.14. The Revised Assessment

the period within whichaffected by a Revised

dissatisfied with it, may r

Shareholder register

1.15. Northern Rocks registmaintain the database of

my mailings. It is theref

continue to update Capit

details at:

Capita Registrars

Northern House

Woodsome Park

Fenay Bridge

H dd fi ld


5/19

Independent Valuation under the Northern

2. Summary of responses to the consultation2.1. The purpose of this section is to summarise the substantive

points arising from the representations made in response to

the Consultation Document and to set out my comments in

respect of them.

2.2. I invited written representations on the ConsultationDocument by 29 January 2010.

2.3. All representations have been made in written form. I havenot met with any Affected Parties since the issue of the

Consultation Document.

Summary of representations

2.4. I set out below a summary of the substantive points arisingfrom the representations I have received and my comments

on them. I have not commented below on those

representations which concern the Government's approach to

Northern Rock and its decision to place it into TPO or any

other matters falling outside the scope of the valuation which

(i) that all financial England (BoE)has been withdra

demand for repay

assumption); and

(ii) that no financiaprovided by the

Rock (apart from

by the BoE subjec

financial assistan

2.6. The words financial 15(1) of the Act, as follow

in relation to any

(a) assistance p

or indemnity

(b) assistance p

which equate

lending mon

involving the

th


6/19


7/19


8/19


9/19


10/19


11/19


12/19


13/19


14/19


15/19


16/19


17/19

Independent Valuation under the Northern

3. The effect of these representations on myprovisional views set out in theConsultation Document

3.1. The purpose of this section is to explain whether or not myprovisional views, set out in the Consultation Document,

have changed as a result of the representations.

3.2. I have reviewed and considered all representations receivedsince the publication of the Consultation Document. None of

the representations I have received caused me to change my

provisional views expressed in the Consultation Document. I

have therefore determined that my provisional views on the

amount of any compensation payable to former shareholdersand those whose rights to receive shares have been

extinguished by Article 4 of the Transfer Order are still

appropriate.


18/19

Independent Valuation under the Northern Rock plc Compensation Scheme Order 2008Consultation document | March 2010

4. My final determination as to the amount ofany compensation payable by the Treasury

4.1. My method of determining the amount of any compensationpayable to Affected Parties is as follows:

(a) determine the assets that would need to be realisedimmediately prior to the Valuation Date to raisesufficient funds to repay the BoE funding;

(b) on the basis that Northern Rock is unable to continueas a going concern and is in administration as at the

Valuation Date, ascertain the amount of any surplus

that would have been available for distribution to

shareholders; and

(c) determine the amount of any compensation payable toAffected Parties.

4.2. Having applied the Valuation Assumptions, I havedetermined that at the end of the assumed administration

there would be a net deficit of approximately 5.68 billion.

4.3. As I explained in the Cappropriate to discount anassumed administration

Northern Rock as at t

determined that there w

distribution to shareholde

4.4. It follows from the deficino value in the shares as

that no compensation is p

4.5. It further follows that asvalue in the right to re

compensation is payable

shares were extinguished

4.6.

No-one has submitted atheir consequential righ

Article 12 of the Transfer

4.7. In summary, therefore, compensation payable

shareholders or to those

been extinguished is nil.


19/19

Independent Valuation under the Northern Rock plc Compensation Scheme Order 2008

March 2010

northern rock 2

Documents