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Mortgages -
Northern Rock Nationalised - 22/02/2008
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Northern Rock has finally come under government control and become nationalized as all shares were taken under government ownership.
The Northern Rock Transfer Act 2008 was passed despite staunch opposition from the shadow cabinet.
The government ruled out two survival bids for the troubled mortgage bank by Virgin and the bank’s management, saying that it was in the tax payers’ interest.
The bank will be headed by executive chairman Ron Sandler, former boss of the Lloyd's of London insurance market. Who will be earning £90,000 a month.
Customers with the bank, many with fixed mortgages, were reassured by the government, being told: “Depositors' money remains absolutely safe and secure. The government's guarantee arrangements remain in place and will continue to do so.”
Ruth Kelley, the transport secretary, appeared on BBC’s Question Time last night and told the audience that the bank would be run at “arm’s length”. She also explained that the government was confident they could later sell the bank back into the private sector and earn back all the taxpayers’ money.
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