Sunday, February 17, 2008

Northern Rock: The road to nationalisation

Northern Rock: a run on the bank.


Funding problems at Northern Rock, the country's fifth largest mortgage lender, triggered the first run on a British bank in more than a century.

As the Times put it at the time:

The jitters plaguing financial markets spread to the high street for the first time (in September) as thousands of panicking savers queued to withdraw millions of pounds from Northern Rock, Britain’s eighth-biggest bank.

The rush to pull out savings followed the revelation that Northern Rock had been forced to ask the Bank of England for a rescue injection of finance.

The timeline for the crisis, which threatened to undermine the banking industry (and destroyed Gordon Brown's allegedly fabulous handling of the surge in Visa debt economy) can be found here .

And then Alisdair Darling the Chancellor of the Exchequer stepped in to calm things down on the radio...

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