Northern Rock savings guarantee to end

The 100% guarantee on savings deposits held with Northern Rock is to be lifted in three months, the British Treasury said today.

The removal of the cast-iron guarantee comes as the UK government prepares to return the nationalised bank to the private sector.

Once the guarantee is removed on May 24, customers will revert to the same level of protection offered to all UK savers, where the first £50,000 (€57,056) is insured by the British government. Fixed-term deposits will be guaranteed to maturity.

City minister Paul Myners said the move shows how far the restructuring of the bank had come.

"Depositors can have confidence in Northern Rock," he said.