Osborne to use £747m from Northern Rock sale to bail out new owners
GEORGE Osborne will use the £747 million from the sale of Northern Rock to bail it out again sometime next year.
The chancellor said the sale to Virgin Money was a good deal for Britain because it meant the Treasury would not have to find additional funds when the bank is eventually renationalised.
He said: “Some may say that selling a fragile bank at a loss in the midst of a potentially catastrophic debt crisis and with a second credit crunch looming on the horizon is not necessarily a spiffing idea.
“And I would say ‘I have absolutely no idea what any of that means’.”
He added: “But at least we’ll be able to give Virgin their money back when this all goes horribly wrong.
“I’m looking forward to doing the same thing with the Royal Bank of Scotland but on a much bigger and more exciting scale.”
A Treasury spokesman explained: “Sometimes you have to sell a house for less than you hoped because you really need to move to a bigger house. We realised we had outgrown Northern Rock and needed to move to a bigger bank with more rooms and a garden.
“Also, we could have waited until Northern Rock was worth more than we paid for it but we were really bored of it.”
Julian Cook, chief economist at Donnelly McPartlin said: “I know that having George Osborne in charge of the money makes for great conversation, but eventually we are going to have to take this seriously.”