Northern Rock Announces Loss Of £585 Million And Possible £3 Billion Present From The Treasury
News that the Northern Rock has made a loss of £585 million in the first six months of the year is a little higher than the £500 million forecast we reported on just a few hours ago. However, while the figures themselves are bad it has been announced that the government is preparing to write of £3 billion of the near £20 billion due to the tax payer. In a complicated action the government will be converting some of the debt into loans and preference shares which will see the bank's core financial ratios strengthened at a time when it is feeling the pinch.
As the newspapers are full of stories that stamp duty may be suspended on house purchases the indication that £3 billion of 'safe' tax payers money may soon be affectively written off will cloud the positive headlines. As has been the case for some time now it seems as though Gordon Brown takes one step forward and two steps back and he is sure to come under intense pressure in the House of Commons from Conservative leader David Cameron.
Will this be the final blow to the PMs stint in office or will his slow, painful and ultimately embarrassing political death be exaggerated even more?
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