Hoban Pledges Protection for Taxpayer in Northern Rock Disposal
U.K. Treasury minister Mark Hoban suggested he is skeptical about returning state-owned mortgage bank Northern Rock Plc to its status as a mutual society owned by its customers.
Hoban reminded lawmakers in London today that the government had injected 1.4 billion pounds ($2.3 billion) into a “good bank” and said he would consider all options as long as taxpayers’ interests are protected.
“I’m not sure you’re expecting us to write off that investment,” Hoban told Parliament’s cross-party Treasury Committee. “Clearly if there are good proposals on re- mutualization,” the government would consider them. “We look forward to seeing whether there are any viable options out there.”
Labour lawmaker Chuka Umunna, a member of the Treasury Committee, is leading a campaign to have the lender revert to its status before 1997, when it became a publicly listed company. He has the support of at least six other lawmakers from different parties.
Newcastle, England-based Northern Rock was nationalized in February 2008 after it suffered the first run on a U.K. bank for more than a century and required an emergency loan from the Bank of England.
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