FinancialAdvice.co.uk Logo

Qualified advisers answering your
Financial Questions
call 0800 092 1245

Is Northern Rock back on the rocks?

The management of Northern Rock have today announced that the company will stop paying interest, where legally possible, on all outstanding bonds. In a move which is likely to cause concern within the UK banking system and concern for UK taxpayers, who officially own the bank, the reason for the announcement was a need to retain as much cash within the business as possible.



Bond holders have already stepped forward and voiced their fury at the potential move which they believe will ultimately undermine the ongoing recovery in the UK banking system not to mention slash the value of their bond investments. This move is part of a wider plan to split Northern Rock into two operations, one concentrating on existing mortgages and the other holding customer deposits, the branches and future mortgage business.



It is well-known that the UK government would like nothing better than to sell on Northern Rock although a forthcoming £3 billion bailout, further money from the UK taxpayer pot, is sure to attract damaging headlines for Gordon Brown and Alistair Darling who made "very firm" promises to UK taxpayers when the operation was acquired. There is no doubt that Northern Rock has been a disaster for the UK taxpayer and despite paying back a portion of the outstanding loan in the early days of government ownership, the loan has actually been increasing over the last few months as the business has demanded further financial backing.

Share this..

Related stories

Financial Guides

Financial Calculators

Our useful calculators can help you get your finances in order:



Latest News

Blogs

Helpful new tax year facts that could affect you and your money


Blog | Seven helpful new 2016/2017 tax year facts that could affect you and your money. Our recent online blog shares a brief outline on how to stay up to date.


Read more

Useful Links

Popular Searches

Please Enter More Details

 
Enter More Details
Continue