Bankers struggle with B&B rump

By Clara Ferreira-Marques and Daisy Ku

LONDON (Reuters) - Top banks that agreed to provide a safety net in Bradford & Bingley's BB.L cash call could end up with a stake of almost 20 percent, as the lender's shares languish and the Friday deadline for underwriters nears.

Investment banks Citi and UBS were left with more than 70 percent of the mortgage lender's 400 million pound twice-restructured rights issue when it closed Friday, with shares hovering just above a deeply discounted 55 pence.

Only just less than 28 percent was sold to shareholders.

Citi and UBS have until close on Friday to place the rump, or remainder of the stock, but B&B BB.L shares have languished well below 55 pence for much of the week.

Since Monday, when the stock hit almost 57 pence, it has not topped the 55 mark and the shares were changing hands at 51.5 at 3:43 p.m. on Thursday.

Sources familiar with the matter said the two investment banks were now likely to fall back on sub-underwriting agreements, including a deal with six clearing banks -- HSBC (HSBA.L), Lloyds TSB (LLOY.L), HBOS HBOS.L, Barclays (BARC.L), Santander's (SAN.MC) Abbey and Royal Bank of Scotland (RBS.L).

Citi and UBS are expected to end up with as much as 75 million pounds' worth of shares, depending on their success in placing the rump.

"Given where the price is trading, it is hard to see that the underwriters will have had much success (in selling the rump)," one source familiar with the matter said.