The news today that the Government has sold our bank to Virgin Money is a great disappointment and a lost opportunity.
The deal in my view significantly undervalues the long term worth of a newly capitalised bank with few poor debts.
The price of £747 million plus perhaps further bonus payments is more about the Chancellor being able to make a political statement about Government getting out of the banking business than a fair deal for all.
And even at that price it should be remembered that it’s based on having expropriated our shares – something that didn’t happen to RBS or Lloyds. Maybe this was because they had more friends in high places in the City than we did.
The opportunity that’s been missed is to allow Northern Rock to have returned to the mutual sector and remain focussed on its historical role – financing homes for ordinary people.
No doubt the name will be swept away and replaced by one which has been used for cola, wedding dresses and a plethora of unsuccessful business activities.
It’s a sad day for all of us in the North East of England.
Robin Ashby
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