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Gordon Brown under pressure to retain Northern Rock

There is mounting pressure for Gordon Brown to retain Northern Rock under government control and convert the company back into a mutual society. Despite the fact that the Treasury and Gordon Brown appear set to split the company and sell off the "good bank" to Virgin Money, many MPs believe now is the time to revert back to a mutual society under government control.

It was also revealed that Northern Rock has paid back just £12 billion of the total £27 billion in loans funded by UK taxpayers. The government has so far refused to consider a potential move back to a mutual society with many believing that Gordon Brown would rather bank a £1.5 billion payment for the sale of the bank and also push for the buyer to start repaying the £15 billion still owed to the UK government.

This will place similar pressure on the UK government with regards to Lloyds bank and Royal Bank of Scotland, in which UK taxpayers have significant stakes, with business leaders pushing for additional capital to be injected into the market. So far there has been little benefit to UK taxpayer's or UK businesses from ownership of Bradford & Bingley, Northern Rock and the significant stakes in Lloyds bank and Royal Bank of Scotland.

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