The value of second-string banking assets in Britain, as perceived by credible buyers of these assets, is taking shape. News emerged late yesterday of terms (or reported terms) offered by Sun Capital for NAB's Clydesdale Bank, while NBNK lodged its bid for most of the "Verde" assets being sold by the Lloyds Banking Group.
City AM and Sky News both reported on a bid by Sun Capital for Clydesdale Bank. Both media outlets put the value of the bid at around £2 billion, or around A$3.1 billion, several hundred million pounds below NAB's book value for the bank.
The two outlets differ on the timing.
City AM reports the Sun offer was made in the last few months, and Sky that the offer was made in recent weeks.
Sky reports that Sun proposed alternative structures: a wholly cash offer or partly cash and partly shares in a new Sun Capital vehicle.
NAB rejected the bid but left the door open to further talks with Sun, Sky reports.
Shares in NBNK, an investment vehicle that has also been linked to a bid for Clydesdale Bank, remain in suspension. NBNK is, or was, undertaking its own talks with NAB.
The Financial Times, however, overnight reported (in the context of an article over the NBNK bid for the Lloyds branches), reports that NBNK was "walking away from a possible tie-up with the UK business" of NAB.
One minor diversion for NAB's stewardship of Clydesdale is the announcement last night by Moody's Investors Service that it has downgraded the long term bank deposit and senior debt rating of Clydesdale Bank to A2 from A1.
Moody's said the long term rating remains on review for possible further downgrade. It also said the Prime-1 rating on short term deposit and debt was also on review for a possible downgrade. The outlook on subordinated debt is negative.
Moody's explained the downgrade on the grounds of "a reduction in Moody's view of the likelihood of parental support for Clydesdale from its parent, National Australia Bank."
In a follow-up announcement, NAB said that its support for the UK business "is unchanged".
NBNK, meanwhile, may have lodged a firm bid with Lloyds for the branches the latter is being forced to sell to meet regulatory requirements.
BBC reports that NBNK's bid is around £1.5 billion, which covers around £36 billion of deposits and £47 billion of mortgages and loans, with the latter figure covering only two-thirds of the loans Lloyds is proposing to sell.