A U.K. tribunal rejected an appeal of a decision that Northern Rock Plc shares had no value following a government bailout.
Shareholders challenged the valuation of Northern Rock’s shares at zero when the lender was nationalized during the financial crisis in 2008, according the ruling dated Oct. 4.
The Bank of England provided emergency liquidity to Northern Rock in 2007 when money markets froze, leaving the bank unable to gain funding by securitizing its mortgages. The government took ownership of all Northern Rock shares in February 2008.
“We have before us no evidence that the government damaged Northern Rock,” Judge Nicholas Warren wrote in the final decision.
A call and e-mail seeking comment from the Northern Rock shareholder action group wasn’t immediately returned.
The case is: Northern Rock v. Andrew Caldwell and HM Treasury, Upper Tribunal (Tax and Chancery Chamber), NR/001/2010.
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