Northern Rock sold to Virgin Money - BUT for less than the taxpayer propped it up for

Discussion in 'Current Affairs, News and Analysis' started by CountryGal, Nov 17, 2011.

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  1. CountryGal

    CountryGal LE Book Reviewer

    apologies if already done I cant see it

    Just read this on bbc news BBC News - Northern Rock sold to Virgin Money

    And sadly this jumped out - "So on paper, taxpayers end up with a loss of somewhere between £400m and £650m," said our business editor.

    There are lots of extras added onto the deal to release some more money back to the tax payer but still we end us with a loss - and that’s before the "hot potatoe" of the Northern Rock (Asset Management), into which was placed its bad debt and to which the government have said "it had no plans to sell Northern Rock (Asset Management)."

    Credit to virgin for agreeing to preserve the amount of jobs currently for at least 3 years, but still the deal sucks - the government has sold the profitable part of the business, or at least the part that offers the chance to make profit, for LESS than it cost to prop the bank up AND retained the bad debt part of the business.

    Cant really see that as a tax payer we've gained any

    edited for fat finger spelling
  2. Listening to some independent financial pundit on the radio earlier although not the best deal to hope for. It was the best on offer. I don't know it's all beyond me.
  3. Nope we didn't gain anything there, despite Osborne saying it was a good deal for the taxpayer.

    1. IIRC Virgin offered £1.5Bn for Northern Rock in entirety before Cyclops nationalised the bank.
    2. We have only sold the saleable bit, we retain Northern Rock Asset Management with its poisonous £21Bn debts/bad mortgages
    3. We, the taxpayer have invested £1.5Bn into NR since nationalisation.
    4. Never take an assurance from Branson about anything, Osborne thinks we will make money in tax revenues, but where are most of Virgin's businesses registered? Where do they pay their taxes?
    5. Sky News was showing an interview with some UNITE union rep who said this deal was a good one, and the former NR shareholders should "do one". If Labour and the Unions think this was a good deal, there is something very wrong with it.

    This is far from the good deal as recommended by Osborne and G Brown MP. Why did Osborne deem it necessary to sell this "asset" at the bottom of the market. We still have the other disasters of nationalisation from Labour, RBS/HBOS/Lloyds to be sold off as "a good deal for the taxpayer".
  4. Seems a strange time to flog it - right at the bottom of the market that is at it's worst since the 1930s.

    Perhaps Osborne is attempting to demonstrate that he is prepared to sell assets and make the Europeans look a bit sluggish.

    However, we must remember that Northern Rock was/ is a basket case compared to some of the other financial institutions and that it was saved by Brown and Darling primarily to protect the serious amount of union loot that NR had under management. If NR had failed, the Trade Union movement and therefore the Labour Party would have been financially ruined.

    Bailing out Northern Rock was effectively financing the Unions and core voters.

    If Northern Rock had been South Eastern Rock, with white collar deposits - it would have been allowed to fail.
    • Like Like x 2
  5. BiscuitsAB

    BiscuitsAB LE Moderator

    WTF are you on about mate? The 100 is 0ver 5400 it went down to 3500 only a few years ago, in 1985 it sat around the 1200 mark. This isn't the 30's.
  6. This has the hall marks of a typical tory sell off! Just like when Maggie sold and ripped of the public with BT. The fact that the good side of NR would enivitably yield sound profits for the tax payer, makes this decision lamentable. Osbourne's arrogance leaves me dumbfounded, Branson has made a killing, how much will Osborne and the conservatives make as well, it will all come out of the word work!

    This deal stinks to the high heavens, just look at NR portfoilio, it is a license to print money, and would have carried on bringing vast sums of money into the treasury. The fact is all of our political masters are thieving troff eating ****#rs!
    • Like Like x 1
  7. I would like to see the list of people that have made money out of this deal, don't need to see a list for those who haven't as it's everybody else.
    Doesn't just stink, it ****ing reeks!
  8. I am not up on this high finance tihing but I seem to recall that when the Geordie Bank was nationalised, it was only after all the dust had settled that the New Labour whiz kids realised that some of the overseas highly valuable "solid gold" parts of it were not included in the deal. What's the problem? just print a lot more Sterling and buy shares in La Rue's and any manufacturer who makes wheelbarrows, Soon we will need one to carry the cash to pay for our shopping!
  9. You will probably find the tory party will receive donations, and palms being crossed and greased, how the hell can he say that selling a profitable business for less than its worth and keeping the toxic and bad part of the company is good for the tax payer is beyond me
  10. What makes you think its worth more?
  11. It should never have been bailed out and allowed to fail.

    What's that you say?

    Most of it's borrowers were in shitty properties bought on 125% mortgages in Labour constituencies oop north?

    What's that you say?

    A number of Labour MP's and Ministers had rather fine property portfolios funded by Northern Cockup?
    • Like Like x 2
  12. Because a trained chimp can tell it is! Why hasn't the treasury declared how much money NR has paid back into the coffers? NR well part of it is running at a profit, thats the part that Branson purchased, thankfully Osbourne has ensured we keep the toxic part with 125% mortgages, because the people with those mortgages will never default! the man is an utter twat period!
  13. I thought 'we' (the taxpayer) owned It. If so, should there not have been some consultation before the sale?
  14. Your shares will be in the post.
  15. **** all divided by **** all equals **** all.