Newspaper article The Evening Standard (London, England)

Northern Rock Savers

Newspaper article The Evening Standard (London, England)

Northern Rock Savers

Article excerpt


20%Northern A FULL-SCALE banking crisis loomed today as customerspanicked and withdrew their savings from Northern Rock.

Chancellor Alistair Darling tried to shore up confidence as the City was rockedby a series of blows.

He issued a "don't panic" message attempting to prevent the crisis spreading toother banks.

But the turmoil engulfed the property, currency and shares markets. In a day ofdrama: .Thousands queued to withdraw Northern Rock savings after the Bank ofEngland stepped in to prop it up with an emergency loan.

. The Chancellor appealed to people to remember the banking system and economywere stable.

. A new report showing the first fall 20%off in asking prices for London homesin two years sent the pound plunging in value.

.The FT-100 stock market fell almost 100 points as traders sold off bank andproperty shares with [pounds sterling]15 billion wiped off the value of the banks.

Northern Rock lost 30 per cent of its share price - an unprecedented fall for abank - as its customers ignored the Chancellor's reassurances and queued to gettheir cash.

Other banks were hit by falls with Alliance & Leicester, HBoS and Barclays downby seven per cent, five per cent and four per cent respectively.

Housebuilders also saw their share off Northern Rock price drop. At least oneNorthern Rock customer rushed to withdraw more than [pounds sterling]100,000.

Retired university lecturer Peter Pye, 60, was among dozens queuing outside theMoorgate branch in the City. He said: "I have my life's savings in NorthernRock," adding that he planned to withdraw a "six-figure" sum and leave [pounds sterling]5,000in his account.

Tony Looch, 68, withdrew his savings after queuing for nearly two hours. Hesaid: "My confidence has been shattered. I would not put a penny into thatcompany again." One woman, leaving Northern Rock's branch in Harrow, said: "Ihave withdrawn all my money. I got here at about 8.40am and was about 12th inthe queue. It took me well over an hour to be served and by the time

Rock savers I got outside there must have been at least 50 people queuing intothe street. I know everyone has been urged not to panic but I just felt safermoving the money somewhere else." By 11.30am the Northern Rock's websitecrashed as tens of thousands of customers attempted to log on to withdraw theirsavings. Customers also gathered outside the bank in Maddox Street, centralLondon, at Kingston-upon-Thames, as well as at branches in Birmingham andNewcastle.

The unease spread after the Government intervened to prop up Northern Rock witha loan facility from the Bank of England.

The Bank agreed to act as "lender of last resort" after Northern Rock wasunable to secure loans from other institutions.

Under the agreement, it will act as a backstop lender to Northern Rock if itruns out of money. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed


An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.