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| Version 3 | Version 4 |
|---|---|
| Tories call for bank assurances | Tories call for bank assurances |
| (40 minutes later) | |
| The Conservatives are demanding government assurances that taxpayers' interests are being safeguarded over Northern Rock bank. | The Conservatives are demanding government assurances that taxpayers' interests are being safeguarded over Northern Rock bank. |
| Their calls come after the bank's chief executive, Adam Applegarth, resigned. | Their calls come after the bank's chief executive, Adam Applegarth, resigned. |
| The bank's shares collapsed after it was forced to seek emergency funding from the Bank of England in September. | The bank's shares collapsed after it was forced to seek emergency funding from the Bank of England in September. |
| Two suitors, Virgin Group and investment firm Olivant Advisers, confirmed they had made proposals to rescue the bank by a Friday deadline. | Two suitors, Virgin Group and investment firm Olivant Advisers, confirmed they had made proposals to rescue the bank by a Friday deadline. |
| The shadow chancellor, George Osborne, said the departure at the bank had added to confusion surrounding the mortgage lender. | The shadow chancellor, George Osborne, said the departure at the bank had added to confusion surrounding the mortgage lender. |
| It has been shored up with Bank Of England loans totalling £24bn. | It has been shored up with Bank Of England loans totalling £24bn. |
| He said the resignation of Mr Applegarth was not enough to reassure taxpayers. | He said the resignation of Mr Applegarth was not enough to reassure taxpayers. |
| "The confusion and indecision surrounding the handling of Northern Rock grows and grows," he said. | "The confusion and indecision surrounding the handling of Northern Rock grows and grows," he said. |
| Takeover 'imminent' | |
| US private equity firms JC Flowers and Cerberus are among other firms expected to come forward with offers for the beleaguered Newcastle-based bank, which is responsible for about one in five mortgages in the UK. | US private equity firms JC Flowers and Cerberus are among other firms expected to come forward with offers for the beleaguered Newcastle-based bank, which is responsible for about one in five mortgages in the UK. |
| There's going to be a deal announced before Monday because if not, on Monday morning, Northern Rock will be an institution without a board Will HuttonWork Foundation Suitors confirm Rock offers | |
| Northern Rock said that David Baker, Keith Currie and Andy Kuipers were standing down as board directors but would stay with the firm. | Northern Rock said that David Baker, Keith Currie and Andy Kuipers were standing down as board directors but would stay with the firm. |
| At the same time, four non-executive directors, Sir Derek Wanless, Nichola Pease, Adam Fenwick and Rosemary Radcliffe, were stepping down immediately, it added. | At the same time, four non-executive directors, Sir Derek Wanless, Nichola Pease, Adam Fenwick and Rosemary Radcliffe, were stepping down immediately, it added. |
| Will Hutton, of the Work Foundation, said the resignations meant a takeover was imminent. | Will Hutton, of the Work Foundation, said the resignations meant a takeover was imminent. |
| "It's no surprise, and they were there to steward Northern Rock through, and their resignation obviously signals that actually that period is over, and that puts a lot of heat on the authorities. | "It's no surprise, and they were there to steward Northern Rock through, and their resignation obviously signals that actually that period is over, and that puts a lot of heat on the authorities. |
| No deal can be done until Alistair Darling makes up his mind how long he is prepared to sustain the enormous financial support he has provided The BBC's Robert Peston Blog: Darling on Rock | No deal can be done until Alistair Darling makes up his mind how long he is prepared to sustain the enormous financial support he has provided The BBC's Robert Peston Blog: Darling on Rock |
| "It means that actually there's going to be a deal announced before Monday because if not, on Monday morning, Northern Rock will be an institution without a board." | "It means that actually there's going to be a deal announced before Monday because if not, on Monday morning, Northern Rock will be an institution without a board." |
| Northern Rock has been in trouble since getting caught up in the global credit crunch over the summer, which left it unable to borrow money from other banks to fund its business model. | Northern Rock has been in trouble since getting caught up in the global credit crunch over the summer, which left it unable to borrow money from other banks to fund its business model. |
| Concerned customers rushed to withdraw their money, and the bank has since been seeking bidders to rescue it. | Concerned customers rushed to withdraw their money, and the bank has since been seeking bidders to rescue it. |
| The problem facing Northern Rock was that three-quarters of its funding came from wholesale money markets, and when the global credit crunch took hold, its main source of financing dried up. | The problem facing Northern Rock was that three-quarters of its funding came from wholesale money markets, and when the global credit crunch took hold, its main source of financing dried up. |
| Northern Rock said Mr Applegarth would step down from his post once he had helped the lender complete the second phase of its strategic review, scheduled for completion no later than the end of January 2008. | Northern Rock said Mr Applegarth would step down from his post once he had helped the lender complete the second phase of its strategic review, scheduled for completion no later than the end of January 2008. |
| Future plans | Future plans |
| Analysts said there were a number of options for the bank going forward, ranging from an outright buy-out to a breaking up of the bank's assets. | Analysts said there were a number of options for the bank going forward, ranging from an outright buy-out to a breaking up of the bank's assets. |
| There's no way out of this position that I can see, other than some form of break-up of Northern Rock John MoultonAlchemy | There's no way out of this position that I can see, other than some form of break-up of Northern Rock John MoultonAlchemy |
| John Moulton, a founding partner of private equity group Alchemy, said the whole affair had done an "enormous" amount of damage to the whole banking system. | John Moulton, a founding partner of private equity group Alchemy, said the whole affair had done an "enormous" amount of damage to the whole banking system. |
| "The moment it was decided to try and rescue it, it was a one-way game," he told BBC Radio 4's Today programme. | "The moment it was decided to try and rescue it, it was a one-way game," he told BBC Radio 4's Today programme. |
| "There's no way out of this position that I can see, other than some form of break-up of Northern Rock - liquidate as much as you can for the government. That'll be the best outcome. | "There's no way out of this position that I can see, other than some form of break-up of Northern Rock - liquidate as much as you can for the government. That'll be the best outcome. |
| "Anything else is going to result in very large losses to the taxpayer." | "Anything else is going to result in very large losses to the taxpayer." |
| A consortium led by Richard Branson's Virgin Group on Friday submitted a formal proposal to rescue Northern Rock. | A consortium led by Richard Branson's Virgin Group on Friday submitted a formal proposal to rescue Northern Rock. |
| Olivant, a team led by veteran trouble shooter and former Abbey National boss Luqman Arnold, said it had made a detailed proposal to stabilise the bank as a viable business and restore its finances. | Olivant, a team led by veteran trouble shooter and former Abbey National boss Luqman Arnold, said it had made a detailed proposal to stabilise the bank as a viable business and restore its finances. |
| JC Flowers has put together a high-profile management team to make their case for taking over the bank, while rival private equity firm Cerberus has also been rumoured to have been scouring Northern Rock's books. | JC Flowers has put together a high-profile management team to make their case for taking over the bank, while rival private equity firm Cerberus has also been rumoured to have been scouring Northern Rock's books. |
| But because any future owner would have to pay back about £24bn of Bank of England loans, analysts said bids were likely to be low. | But because any future owner would have to pay back about £24bn of Bank of England loans, analysts said bids were likely to be low. |