Northern Rock - Protected Savings?

stv1x

As figures now published indicate a £0.6 billion loss, commentators have suggested that the company could be broken up and sold on. NR have driven good borrowers away leaving them with customers who are potentially unable to make mortgage payments. These borrowers are unable to leave NR due to the current borrowing criteria. It's my guess that NR can only go one way and political forces will probably dictate that rather than continually feeding it with public money that they look for an exit strategy.

I distrust the Government immensely and was wondering if by selling the company on that they could somehow avoid the 100% protection given to savers by doing so?

Thoughts?
Steve

Farway

Any government could do anything in time, as Parliament is supreme, but political expediency would indicate to me that avoiding the 100% protection would be something any set of politicians, facing a financial downturn and an election in a few years, would not do

However once NR is sold, then a protection would be that of the buying bank, so your point is valid, over 35k at any rate

My guess would be to prevent a sudden exit of savers over 35k the protection issue would try & be fudged or hidden by the purchaser, in the hope no one noticed

stv1x

I wonder how much notice, if any, the general public would have of such a takeover.

Can't help being cynical and believing that the only plus to a potential buyer of NR would be to extract anything over and above the guaranteed £35k from savers before winding the whole thing up.

ian-d

Northern Rock still concern me, especially as I have a lot of money in an account with them. I was attracted by it being a safe place for my money, yet my distrust of the govenment leads me to wonder whether I should withdraw the money back out. I think the govenment said before they are giving NR another 3billion due to debts and can only think that they will be looking to sell on piece by piece soon!

stv1x

Ian, seems that we may be thinking along the same lines.

I'm inclined to withdraw savings and look for alternatives as I trust banks more than I trust the Government and that's saying a lot in the current climate.

GL
:beer:

Andrew64

Just keep less than 35,000 in your NR account and you should be safe. Personally though, I wouldn't want to keep my money in a bank that's been so badly run, and on top of that can we trust this government!?