Downing Street Says » Northern Rock

» Thursday, November 29, 2007

Northern Rock

Asked if the Government was concerned that further credit had been given to Northern Rock, the PMS replied that the Chancellor and others had made the situation in relation to Northern Rock clear on numerous occasions. There was a process of sale of Northern Rock underway, with Virgin having emerged as the preferred bidder. As people would also know, the lending was secured against Northern Rock’s assets.

Asked repeatedly if the Prime Minister was 100 per cent confident of getting it all back, the PMS said that the Prime Minister’s position was that he was supporting the Chancellor’s efforts to secure a sale of Northern Rock. Negotiations were underway on that front. The Prime Minister and Chancellor had made the position clear. Asked if he was confident that Northern Rock’s assets were worth what they had said they were worth, the PMS replied that it was not for him to make those judgements. The Treasury had made their position clear, as had the Bank of England on numerous occasion, so he would let them speak on such matters.

Asked if the nationalisation of Northern Rock was still a fallback option, the PMS replied that it would be best to raise such questions with the Treasury. As people knew, the position at the moment was that there was a preferred bidder; negotiations were underway which were commercial and market sensitive and the PMS did not think it appropriate to comment further in view of that.

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