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more troubles at northern rock September 17, 2007

Posted by Bradley in : Uncategorized , trackback

Savers continue to withdraw funds despite this announcement by Callum McCarthy of the FSA on Saturday:

To be absolutely clear, if we believed that Northern Rock was not solvent, we would not have allowed it to remain open for business. It is open for business and it can continue to receive deposits and allow customers to make withdrawals.

The Chief Executive of Horthern Rock stated on Sunday:

Your money is safe with us and if you want some, or all of it back, then you are perfectly entitled to it. Whilst you may have to wait a little longer than usual to receive it, you will get it. However, your savings are secure and there is no need for you to withdraw your money based on our recent announcement, and the widespread media coverage that has ensued. The Bank of England has agreed to provide a funding facility to enable us to manage through the current global liquidity crisis. They would not have done so, if we were not a solvent, adequately capitalised, well run bank. I hope this helps to reassure you.

Meanwhile the Guardian and the BBC are remembering the UK’s secondary banking crisis in 1973.

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