Parliament Approves Northern Rock Nationalisation

Parliament passed legislation on Thursday that will allow the government to make Northern Rock PLC, the first sizable British bank to be nationalised in 25 years.

On Thursday night, the House of Commons approved the nationalisation legislation by a margin of 126 votes. The bill then went back to the House of Lords, where its legislators first rejected three provisions of the bill. They later dropped their opposition without a vote.

The Liberal Democrats and Conservatives had argued over the last three days that Northern Rock's offshore special purpose vehicle Granite might be used to siphon off assets from Northern Rock.

Chancellor Alistair Darling has insisted that it is up to the new management team at Northern Rock and that it should have no impact on tax payers if they decided to wind it down.

The government must now obtain an order which transfers the bank to public ownership, powers which were awarded by the bill. An order which deals with compensation to the bank's shareholders will then follow.


Related UK National News Stories
Click here for the latest headlines.

03 August 2010
Northern Rock Steadfast In Recovery
The boss of a once beleaguered UK bank is "encouraged" by news that nationalised Northern Rock's - a so-called 'bad bank' - has returned to profit following heavy losses last year in the wake of a bail-out by the taxpayer in 2008. Chief Executive Gary Hoffman said the Northern Rock 'AM' results were 'encouraging'.
13 February 2009
Northern Rock Shareholders Lose High Court Bid
Former Northern Rock shareholders have today failed in their legal challenge to the Government's plan to compensate them.
15 January 2008
Northern Rock Shareholders' Proposals Defeated
An Extraordinary General Meeting with the Northern Rock board and shareholders at the Metro Radio Arena in Newcastle today has seen all but one of the proposals put forward by two shareholders defeated.
18 December 2007
Northern Rock Gets Taxpayer Billions
The Government is bailing out troubled bank, Northern Rock, again. At the request of the lender, it has offered to cover any loss by financial institutions that provide money to Northern Rock so the bank can operate normal banking services.
01 May 2008
Job Cuts Planned At Troubled Bank?
Troubled lender Northern Rock plans to axe 2,000 jobs within three years, it has been reported. The bank has been struggling since last year due to unsettling financial conditions sparked off by the global credit crunch. Long queues formed outside the bank last September as savers tried to withdraw their savings.