The UK Treasury today announced that the beleaguered bank Northern Rock will be nationalised.
In a statement, Chancellor Alistair Darling said “under the current market conditions” neither of the two private proposals delivered “sufficient value for money to the taxpayer”.
It marks the failure of the UK government to reach a deal with the private sector over the future of the bank. Emergency legislation will now be rushed through Parliament.
Mr Darling said the move met ``our objective of protecting taxpayers' interests''.
He said he had been told by the Financial Services Authority that the bank was solvent and that its mortgage book remained of good quality.
Ron Sandler, the former chief executive at Lloyd’s of London, will now run the business.