State-rescued Northern Rock bank halves losses
LONDON — British bank Northern Rock, nationalised during the global financial crisis, said Wednesday that its losses halved in the first six months of 2011 and it expected to trade profitably next year.
The lender was last year split in two, forming a so-called "good bank" for its healthy businesses and a "bad bank" management company to wind down toxic assets.
The "good bank" -- Northern Rock Plc -- reported on Wednesday a pre-tax loss of £68.5 million (78.7 million euros, $114 million) for the six months to June compared with a year-earlier loss of £142.6 million.
Underlying losses stood at £78.8 million, down from £140 million.
"Northern Rock has made good progress in the first half of 2011," the bank's executive chairman Ron Sandler said in an earnings statement.
"The company continued to be loss-making, as expected, but losses are significantly reduced and we are generating momentum. The company expects to begin trading profitably during the second half of 2012."
Sandler added that the bank continued to explore options for a sale of Northern Rock as it looks to return to the private sector.
"In the meantime, it is business as usual. We remain focused on serving our customers, providing them with attractive products and a safe home for their savings and mortgages," he added.
Northern Rock collapsed in mid-September 2007 when the credit crunch forced it to seek emergency assistance from the Bank of England, sparking the first run on a British bank in recent history.
To prevent a wider system meltdown, the government agreed in December 2007 to guarantee all customer deposits held at the struggling group, before taking the lender over in early 2008.
The government in June announced that Northern Rock would be privatised while the BBC said the state planned to sell it to a single buyer for about £1.0 billion, less than the £1.4 billion it cost to bail out.
Northern Rock Bank - News
LONDON — British bank Northern Rock, nationalised during the global financial crisis, said Wednesday that its losses halved in the first six months of 2011 and it expected to trade profitably next year. The lender was last year split in two,
The sky is reflected in a sign at a Lloyds TSB bank in southwest London June 30, 2011. By Sudip Kar-Gupta LONDON () - The sale of nationalized British bank Northern Rock and a separate deal to offload 630 Lloyds (LLOY.L) bank branches have
LONDON, July 28 () - Britain's fifth biggest mortgage provider, the "bad bank" managing the toxic assets of collapsed UK lender Northern Rock, said it expects pressure to build on borrowers this year due to higher taxes,
LONDON () - Two of Britain's leading mutually-owned savings companies - Coventry Building Society and Yorkshire Building Society -- both decided against bidding for Northern Rock, the nationalized British bank put up for sale by the government.
The start was marked by investment bank BNP Paribas closing two of its funds exposed to the US sub-prime crisis on 9 August 2007. Within just a few weeks, the queues of worried customers were forming outside the Northern Rock.
Northern Rock finds it's a bad time to good bank
HSBC, Britain’s largest listed bank and one that is also funded largely by customer deposits, has despite its recent profits bemoaned the low interest rate environment that has put it at a competitive disadvantage to peers that rely more on cheaper wholesale funding.
When this situation will change is hard to tell. Any lingering predictions of a near-term rise in interest rates will have been shelved by the anaemic growth figures published last week and with the eurozone debt crisis still yet to play out it would take a brave forecaster to bet on a rise any time in the next 18 months.
For Northern Rock this presents it with a funding dilemma between expensive, but more stable consumer deposits, and cheaper but more risky wholesale funding.
It also raises the issue of what it should do to generate a return on its assets in the low-yield environment. Northern Rock said this morning that it had reduced its cash deposit with the Bank of England by 80pc in the last 12 months to £1.3bn, at the same time increasing its holdings of investment securties by more than 600pc to £4.8bn.
With gilts yields hitting decade lows, this search for yield is likely to become more intense and Northern Rock, like other banks, will necessarily be forced to take more risk to improve its return.
All of which means it is a bad time for those trying to be a good bank.
Bank of England Shipwrecked on Northern Rock 
That awkward moment when you rob a bank to realise it is Northern Rock...then you decide to pay them 
6 weeks ago, claimed it was "the beginning of the end of the financial " 
@ mega, I was gunna travel down with H. I'm skint..I owe the bank more money then Northern Rock
Robert Peston effectively caused the Northern Rock bank run due to how he covered the bank asking for a loan from the Bank of England.Northern Rock Bank - Bookshelf
The Run on The Rock, Hc 56-i, Fifth Report of Session 2007-08, Report, Together With Formal Minutes
The Bank of England liquidity facility announced on 14 September 333. The first public sector support for Northern Rock was the liquidity support facility ...The nationalisation of Northern Rock, thirty-first report of session 2008-09, report, together with formal minutes, oral and written evidence
Prior to 2007, the Treasury did not judge the work to address these gaps to be a priority.Financial Regulation in Crisis?, The Role of Law and the Failure of Northern Rock
This book provides a detailed legal analysis of the role played by financial law and regulation during this event, and the impact the episode made on the law.Risk and Liquidity
Rock, the public announcement by the Bank of England on September 14 was recognition that Northern Rock's predicament had reached the point where only ...Macroeconomics, Principles and Policy
One of its victims was a large British mortgage lender called Northern Rock. In mid-September 2007, rumors that the bank was in trouble precipitated the ...News Article Directory
Northern Rock plc
Offers savings accounts, mortgages, personal loans, and more.
Northern Rock - Wikipedia, the free encyclopedia
Northern Rock plc (former London Stock Exchange ticker symbol NRK) is a British bank, ... Formerly the Northern Rock Building Society, the bank was formed in 1997 when ...
Northern Rock
Internet bank. Tilbyder opsparingskonto til privat- og erhverv kunder.
Nationalisation of Northern Rock - Wikipedia, the free ...
In 2008 the Northern Rock bank was nationalised by the British Government, due to financial problems caused by the subprime mortgage crisis. ...
FT.com / In depth / Northern Rock in crisis
The nationalisation of Northern Rock has angered shareholders and shocked the private bidders who hoped to take over the stricken lender