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In a trading update issued this morning (2 June) the buy-to-let lender said the firm had agreed to invest £179m and become a major strategic investor.

Bradford & Bingley has also restructured its rights issue to raise £258m. All shares will be issued at an offer price of 55p per share.

This is a reduction from Bradford & Bingley earlier cash call announced last month, asking existing shareholders to raise £300m in new capital.

At the same time it was revealed over the weekend that Steven Crawshaw had stepped down as chief executive due to a "serious illness".

The Council of Mortgage Lenders (CML) has also confirmed that Steven Crawshaw will be stepping down from his position as chairman. A temporary replacement is expected to step into the role before a successor is appointed.

Rod Kent, chairman of Bradford & Bingley, will temporarily replace Crawshaw at the helm of the lender. He takes over as executive chairman.

Underlying profits at Bradford & Bingley for the first four months of 2008 was £56m, down from £108m in 2007.

Kent says: "The last few weeks have been challenging for Bradford & Bingley, and this is a disappointing trading update reflecting a more difficult market environment. I understand shareholders' disappointment."