Issues of building society PIBS only tradable in certificated form

[Holts]

Had the following from Skipton today :

I wanted to provide you with an update and to let you know we are continuing to explore CREST settlement and the process which was undertaken previously by the Registrar. We have since been in touch with the LSE to ensure that the current settlement processes continue to meet the post-trade rules and also gain their perspective on future requirements. I am therefore aware of the Digitisation Taskforce – Interim Report from July 2023.

Whilst the current arrangements are not satisfactory for yourself I can assure you we are progressing discussions with the Registrar and other parties involved to understand more fully the processes to enable electronic settlement.

[bruncher]

Had the following from Skipton today :

I wanted to provide you with an update and to let you know we are continuing to explore CREST settlement and the process which was undertaken previously by the Registrar. We have since been in touch with the LSE to ensure that the current settlement processes continue to meet the post-trade rules and also gain their perspective on future requirements. I am therefore aware of the Digitisation Taskforce – Interim Report from July 2023.

Whilst the current arrangements are not satisfactory for yourself I can assure you we are progressing discussions with the Registrar and other parties involved to understand more fully the processes to enable electronic settlement.

I received the same

[OldBoyReturns]

Had the following from Skipton today :

I wanted to provide you with an update and to let you know we are continuing to explore CREST settlement and the process which was undertaken previously by the Registrar. We have since been in touch with the LSE to ensure that the current settlement processes continue to meet the post-trade rules and also gain their perspective on future requirements. I am therefore aware of the Digitisation Taskforce – Interim Report from July 2023.

Whilst the current arrangements are not satisfactory for yourself I can assure you we are progressing discussions with the Registrar and other parties involved to understand more fully the processes to enable electronic settlement.

I received the same

Ditto - I received a variation of that reply as well. So it seems Skipton are rowing back from their ludicrous position that certificated only settlement:

1. Meets the requirements of the majority of PIBS holder members; and
2. Is fine because the PIBS were issued before CREST came into being

Just imagine if Skipton made the same claims to justify only allowing its members with savings accounts to deposit or withdraw funds in branch with a passbook!

More pressure is needed here because Skipton are now claiming to be doing what they told me they would do back in March when I raised the issue with them.

[Borderline]

I have received the following from Lucy Leinster, Senior Assistant Secretary at Leeds Building Society in response to my complaint about the difficulty transferring my holding of their PIBS.
It was in the form of a letter through the post rather than email and it sounds like they are unaware most holdings are in nominee accounts.
Even though they consider the complaint closed I will be writing a response in the new Year.
Nothing from the others.

“We passed your details to Computershare Investor Services who maintain the PIBS register for the society. Computershare has day to day responsibility for the maintenance of the register, administration of the interest payments and correspondence with PIBS holders.
Computershare has searched the register using the information you provided and has been unable to locate a record of your holding. We are therefore unable to provide you with any information relating to your holding until we can verify your details. However, we can confirm the following:

Leeds Building Society PIBS can only be traded in certified form.
There is currently no obligation for the PIBS to be transferable via CREST.
The society has engaged with Computershare regarding the matter, and we are exploring a potential solution together with the associated costs.
In the event that the PIBS do become transferable via CREST, we would expect the holders to be made aware through their established contacts.

We’ve finished looking into your complaint, so it will now be closed.”

Merry Christmas to everyone

[Rhinocol]

Borderline, This seems typical of the Leeds. I've been with them for years ( I only stay with them cos they have a branch in my home town) and they are pretty slow off the mark with most things. I have Leeds pibs also so I too will chase them in the New Year.

[Holts]

I’m assuming the holding replies from Skipton and subsequently nothing are simply because there will be an LBS type offer along in a relatively short time .

[Borderline]

The BOi got their Tender Offer away last year at the height of uncertainty on how high interest rates would go.
The Leeds are now trying their version, which is very similar to the BOi offer, when Interest Rates are probably at their peak [for the time being].
If the Leeds manage to succeed in passing the resolution to sweep up all the Pibs then it will give the green light for Skipton to have a go.
However, if interest rates start to come down in the second half of the year as widely anticipated then the price of Fixed Income should start to go up so Skipton will need to act quickly.
The Coventry are probably too busy trying to buy the Coop Bank.

[OldBoyReturns]

The BOi got their Tender Offer away last year at the height of uncertainty on how high interest rates would go.
The Leeds are now trying their version, which is very similar to the BOi offer, when Interest Rates are probably at their peak [for the time being].
If the Leeds manage to succeed in passing the resolution to sweep up all the Pibs then it will give the green light for Skipton to have a go.
However, if interest rates start to come down in the second half of the year as widely anticipated then the price of Fixed Income should start to go up so Skipton will need to act quickly.
The Coventry are probably too busy trying to buy the Coop Bank.

Leeds BS has certainly got first mover advantage in tendering for its PIBS before other societies have made their move. They also picked a time when the yield on LBS was an outlier on the high side so have managed to make an offer which is attractive compared to market in LBS while not being particularly attractive compared to other PIBS and prefs.

Gawd knows what Skipton and Coventry are playing at. It is very quick to put together a cash tender offer yet they have both sat on their hands in respect of both arranging CREST settlement and tendering for their PIBS. An expensive delay for both societies.

Incidentally, I am not sure it is right to predict that the price of fixed income will go up if / when interest rates start to come down. Current PIBS and prefs yields are already pricing in a reduction in interest rates, as well as tender offer anticipation in many cases, so rates are going to have to come down more than the market is currently forecasting for fixed income yields to fall much further.