Crisis at Northern Rock

The British mortgage giant is getting a bailout from the Bank of Englandraising questions about banks' vitality in Britain and across Europe

Just how serious the credit squeeze is becoming, not only in the U.S. but also in Europe, hit home late on Sept. 13 when news emerged that Northern Rock (NRK.L), one of the five largest British mortgage lenders, had been forced into a bailout from the Bank of England. In a conference call Sept. 14, Adam Applegarth, Northern Rock's chief executive, said: "Frankly, life changed on Aug. 9, virtually like snapping a finger. Watching liquidity disappear on a global basis has been astonishing."

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