Page last updated at 19:49 GMT, Sunday, 17 February 2008

Your reaction: Northern Rock nationalised

The sudden announcement that Northern Rock is to enter temporary public ownership has brought swift reaction from customers, staff and others. Here is a selection of comments from those spoken to by the BBC News website:


Paul Hughes
Paul Hughes fears he could end up back in rented accommodation

Paul Hughes, a Northern Rock mortgage holder from Swindon, is already unhappy with the government's financial record and does not trust it to run a bank.

His three-year fixed-rate mortgage comes to an end in July and he fears the move could spell financial disaster for him and his family.

"Is my mortgage going to be sold off? Will I get less favourable terms when my fixed rate mortgage expires?" he demands.

"Will the government do what private equity firms do - run it into the ground and sell it off piecemeal to the highest bidder?"

Mr Hughes, who heads a council payroll department, accuses the Treasury of imposing excessively onerous conditions on Northern Rock bidders, adding: "It seems like they were being set up to fail."

"It's a very frustrating time," he says. "I am about to get remarried and take on a young child as well and I'm wondering whether I'll end up having to sell my house and returning to rented accommodation."


Nigel Hutt, from Doncaster, is feeling positive about the nationalisation of Northern Rock.

Mr Hutt, a coal sampler, took his mortgage out with the bank two years ago and has three years left with his fixed rate.

"I was worried when all the problems started but my brother's wife works in a bank and explained that I would not be adversely affected," he said.

"This move gives security to the bank and I will get my tax money back. Selling it now would have been a bad move as they would have got nothing for it because of the financial climate."

Mr Hutt has loans and insurance tied in with his mortgage, and pays around 640 a month.

"I do feel sorry for the shareholders but it's my tax money propping up Northern Rock and I want that back," he added.


Ian Riley
Ian Riley hopes Northern Rock remains nationalised

Ian Riley has had a Northern Rock mortgage for ten years and says he's delighted with the nationalisation of the company.

Mr Riley currently pays 550 each month on his fixed term mortgage, which is due to end in July.

"We are expecting a hike in the summer judging by the comments being made but it was a good deal at the time we took it out," he said.

"We would prefer to stay with Northern Rock but in reality we just don't know what will happen."

Mr Riley, who says he would never own shares in any company, hopes the public ownership move is permanent.

"I hope the nationalisation is not temporary," he said. "The money should stay in the hands of the Government and the people, rather than go to the shareholders.

"Shareholders should appreciate that they have lost out."


Rod Collier, from Bournemouth, opened his account with Northern Rock at the beginning of 2007.

Mr Collier, an administrator for a firm of solicitors, had around 50 in his account when the bank ran into problems in September last year.

"I had been paying money in and out of the account on a regular basis," he said. "But when the Government announced that it would guarantee deposits I transferred a few thousand pounds into the account as the money would be safe, and it had a high interest rate."

Mr Collier says he will not be affected by the nationalisation of Northern Rock as he does not hold shares.

"I don't think they had much choice but to nationalise," he said. "I hope they can make a successful sale on behalf of the tax payers and the shareholders.

"The majority of big shareholders are usually pension funds so it could have a big effect on people's pensions."


The Government is totally financially inept and I certainly wouldn't give it the keys to my piggy bank
Armand Borisewitz
Northern Rock shareholder

Armand Borisewitz, a Northern Rock shareholder from Aberdeenshire, believes nationalisation is better than the bank going to a consortium such as Virgin, which he believes would make "huge profits on the back of taxpayers."

But he is far from confident about the government's ability to run the bank, noting: "It is totally financially inept and I certainly wouldn't give it the keys to my piggy bank."

Mr Borisewitz and his wife moved 10,000 of their savings from Northern Rock when the crisis first broke, but still have shares - previously worth about 12,000 - which they were awarded when it ceased to be a building society.

He says they will cope with losing the potential return from their shares, but adds: "The people I am really sorry for are all the bank's original savers and all those who looked at their shares as some kind of nest egg, when they will be worth nothing now."


Sylvia Murphy has been a Northern Rock customer for 40 years, since it was a building society. She holds 1,000 shares in the bank and has seen their value drop from 12 to 90p each during the current crisis.

She was counting on the shares as additional savings towards her retirement. She says she is gob-smacked by today's announcement.

"I can't lose any more. I've got nothing left", she said. "I'm just a little person. What about people who had invested a lot more?"

She questions why the government did not make the decision to nationalise earlier, when share prices were stronger.

"Alistair Darling and Gordon Brown have made a real mess of everything. It's a Whitehall farce."

Now Northern Rock is being nationalised, Sylvia intends to move the remainder of her savings to another bank, because she does not trust her money in government hands.

"Look at what happened to the carmaker Rover when it was nationalised. The company went bust", she added.

"This is bad for the North East and for the Northern Rock employees. It leaves us with egg on our face."


A Northern Rock worker from Sunderland who works in mortgage arrears spoke to the BBC. We agreed not to publish his name.

"The employees have done all they can over the last few months. We've made a real effort, we've really pushed the boat out," he says.

"Now, we find out the company's being nationalised in a statement on the television. I knew nothing about it."

When he joined the company three years ago, he was told job security at Northern Rock was second to none. The bank was held in high regard.

Now, he says, "I've no idea what's going to happen to my job".

Since Northern Rock got into trouble, he says there's been an unofficial policy to unload arrears onto other banks.

"Lending has been at a virtual standstill", he says. "When customers have come to us to renew their mortgage deal and they face a higher interest rate, we've been trying to get them to go to other lenders."

"That's because the bank has to keep arrears on its mortgage book below 4% when it reports to the financial authorities."

A house-owner with a mortgage and a car to pay for, he says he is actively looking for another job because he's lost confidence in Northern Rock.

Referring to his own financial circumstances he says, "I'm quite fortunate, because I work in mortgage arrears and I know what the policies are."

"But I know colleagues who've lost thousands of pounds over the last few months through the drop in share prices. Yet they're still putting in extra hours for the company."

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