WBS Plc. has a market capitalization of GBP100 billion and in equity beta of 0.8. It has GBP25billion of bonds rated B by S&P with a yield to maturity of 7.1%. Assuming a market risk premium of 5%, a risk-free rate of 2.5%, a default rate of 5.5% for B-rated bonds and an average loss rate of corporate bonds of 60%, estimate the firms cost of capital.