New nationalisation rumours hit Northern Rock

Crisis-hit Northern Rock suffered more stock market misery today amid revived speculation that the mortgage lender faces nationalisation.

Shares in the stricken bank fell almost 8% today following BBC reports that both rescue deals on the table failed to match up to the expectations of the British government.

Richard Branson’s Virgin consortium is ahead of a management-led team in the race for Northern Rock, but the British government is prepared to nationalise the group unless it gains a better price and a bigger share in any recovery, the BBC said.