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Northern Rock is being sold to Virgin Money for £747m, the government has announced. The bank was taken into public ownership in 2008 when it got itself into financial difficulty as a result of the turbulence in the global financial market. The government subsequently split the bank into two, Northern Rock plc, and Northern Rock (Asset Management), into which was placed its bad debt. Virgin is buying Northern Rock plc.
Chancellor George Osborne said:...Read more HERE
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The sale of Northern Rock, which netted the Government £747m in cash is being part funded by existing cash in the bank itself. More than £250m of “excess capital” will be taken out from Northern Rock to help pay for the bank. A further £150m or so will also be extracted from Virgin Money – leaving the combined business with a thinner capital cushion.
Before the bank was sold Northern Rock’s tier 1 capital ratio was 30pc – significantly above what other high street banks have on their books. The combined group under Virgin money will still retain a 15pc tier 1 capital ratio. Sources suggest that without the £250m helping hand from the bank’s own balance sheet, no deal would have been...Read more here--> Virgin Money used Northern Rock cash to fund deal - Telegraph
Ed Miliband stands accused of hypocrisy by Chancellor George Osborne after it was revealed the last Labour Government agreed a secret deal with Brussels over the timing of the Northern Rock sell-off. Treasury sources say that......Read more here..---> Miliband faces backlash over secret Northern-rock sell-off deal | This is Money
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