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Northern Rock given £1bn price tag by Osborne
Business digest: State-owned bank to be resold as Osborne says it was ‘time to get our money back’
Northern Rock is to be sold at an estimated value of £1bn, chancellor George Osborne announced last night, meaning that the government is likely to make a loss after bailing out the failed bank for £1.4bn in 2008.
Osborne said that it was "time to get our money back", even if that means a short-term loss for the taxpayer. The sale of Northern Rock, chosen over a remutualisation or flotation, will repay tens of thousands of state aid loans tied up in Northern Rock Asset Management, known as the 'bad bank'.
The deal will see any interested party being allowed to bid, including mutual owners. Virgin Money and Yorkshire Building Society are expected to make bids for the bank.
The news came as Mervyn King, governor of the Bank of England, warned that Britain wouldn't fully recover from the economic crisis until 2014.
Read a full report at the Daily Telegraph. ·
