Bradford & Bingley does U-turn on blaming KPMG

Bradford & Bingley has made a U-turn on earlier comments this week when
it blamed a decision by KPMG, its auditor, for the fall in value of CDOs for
part of its writedown.

The bank, which took a £225.6m writedown, which halved 2007 pre-tax profits
to £126m, has now admitted there was no rule change.

The bank’s CE, Steven Crawshaw, earlier told the
that KPMG’s decision was the ‘toughest thing’ in the figures – a comment which
left several in the city puzzled over the unknown accounting change.

The bank, which focuses on buy-to-let assets, also attributed the latest
further clarification of the accounting treatment to its completion of the final
accounts for 2007.

‘B&B continues to have an excellent relationship with its auditors,
KPMG,’ the bank said.

Auditors were yesterday left unimpressed by Crawshaw’s remarks.

‘It is just volatility in the markets. If they don’t like it, maybe they’d
like to invest in something else,’ said a senior audit partner.

Further reading:

Bradford & Bingley slams IFRS after £94m writedown

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