Osborne to announce auction of Northern Rock this week
CHANCELLOR George Osborne is expected to use his Mansion House speech on Wednesday to announce plans to auction off state-owned bank Northern Rock
Osborne is expected to make the announcement at his annual address to the City of London’s financial elite — a gathering that will also be addressed by Bank of England governor Mervyn King.
A Treasury spokesman declined to comment on the report, beyond confirming that Osborne’s speech would refer to financial services and banking issues.
Northern Rock was nationalised three years ago after becoming the first major British bank in more than 150 years to suffer a bank run, and Deutsche Bank has been advising the government on how to return it to the private sector.
An auction means Northern Rock is unlikely to become a customer-owned mutual — a solution favoured by some Liberal Democrat MPs — unless the highest bid is from one of Britain’s relatively small mutually-owned building societies.
Yorkshire Building Society and Coventry Building Society have expressed interest in recent months, as well as Virgin Money.