Whilst I don't think the possibility of a sale can be ruled out, I think the chances are rather distant. Northern Rock is still a loss maker and still owes the government quite a few billion quid. The current state of the markets means that financial shares are not fetching a great deal. Any sale will generate few returns and make only a marginal impression on government debt. The situation may be different in a few years' time. Financial shares hopefully will have recovered and privatising the bank will make sense at that point.
What strikes me as interesting is that Newcastle Central MP Jim Cousins was quoted in the Journal as wanting assurances the sale will not go ahead. Mr Cousins, however, was one of the leading critics of the Lib Dems for proposing nationalisation of the Rock back in 2007. The Labour party in the North East back then where unanimous in their belief that a government buy-out of the bank would lead to the end of civilisation and the death of all first born. Now they are concerned that the same outcome will occur if the bank is sold off. It's a funny old world.
Mind you, a sale to another company has to be resisted. If there is one thing we should learn from the recent banking crisis it is that the banks as individual organisations are too large, remote and, given the chance, irresponsible. Merging more of them just perpetuates the problem. It's one of the main reasons why Lloyds should not have been able to take over Halifax. Northern Rock is downsizing, hence the ability to pay off over half the company's debt to the Bank of England. When it is in fit shape to return to the private sector, it will be smaller but leaner. And it should be independent and free standing.
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