Market report: Shawbrook on the slide after investor sells out

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A meaty share sale from its biggest backer caused a stampede for the exit at challenger bank Shawbrook.

The Special Opportunities Fund run by Pollen Street Capital — the private-equity firm spun out of the Royal Bank of Scotland in 2013 — dumped 25 million shares at 335p for £83.75 million. It will still own a 44.6% stake.

Shares in the FTSE 250 bank have been on a strong run since the appointment of new chief executive Steve Pateman, who was poached from Santander UK. But the apparent lack of faith from Pollen that the share price will continue its lucky streak was viewed by investors as a sure-fire sell sign and it tumbled 29.3p or 8% to 332.8p. 

Its rival challenger bank Aldermore revealed its loan book swelled 20% to £5.8 billion in the third quarter thanks to SME and mortgage lending. Investors banked profits after a 34% rise this year and shares slipped 12.5p to 274.5p.

Ian Gordon at Investec says  Aldermore is the cheapest UK bank trading going by his earnings forecasts for 2017. 

Gordon told clients to offload shares in OneSavings Bank, which dropped 12.18p to 389.82p, on a downgrade to Sell, which the number-cruncher said was based on a pricey-looking stock, rather than anything wrong with the business.

The FTSE 100 continued a weary November performance by drifting 34.56 points lower to 6262.64 as investors’ gaze was fixed across the Atlantic with concerns surrounding what appears to be an imminent hike in US interest rates. Private equity firm 3i edged up 1.5p to 494p after a solid first-half performance despite the tough oil price climate.

Glencore rejoined the penny stock club as the trader-cum-mining giant’s shares slumped 6.3p to 97.55p after fears resurfaced about its debt mountain with the commodity-price slump worsening.

Shares of equally embattled rival Anglo American were off another 24.75p to 468p after its Brazilian iron ore boss resigned.

The NHS funding squeeze caused private health group Spire, down 41p or 11% to 318.5p, to cut its full-year profit and revenue guidance.

Petra Diamonds lost some sparkle amid weak diamond prices, down 1.75p to 59.25p, even as the so-called “Blue Moon” diamond it mined was sold for a record $48 million (£32 million) at auction.

A profit warning from Ubisense, caused by the VW scandal, triggered a 17p or 20% dive to 65.25p, while on AIM, Xeros Technology Group retreated 5.5p to 222p after a £40 million share placing at 225p a pop.

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November 12, 2015 |
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