Newspaper article The Evening Standard (London, England)

Treasury Puts Curb on Rock Guarantee

Newspaper article The Evening Standard (London, England)

Treasury Puts Curb on Rock Guarantee

Article excerpt

Byline: NICK GOODWAY

NORTHERN ROCK'S future looked even shakier today as the Government saidits guarantee to savers will not apply to new accounts set up after midnightlast night.

Its shares fell another 16%.

At the same time, a leading credit agency slashed its ratings on Northern Rockon the basis that the bank could be wound down.

The shares fell 37p to 220p today as immediate takeover hopes faded.

The Treasury said its guarantee on deposits, interest payments and movement offunds would only apply to accounts existing at midnight. However, it would beextended to any of the thousands of savers who had closed accounts between lastThursday and yesterday and now wanted to reopen them. But it made it clear thatnew accounts opened from today will not be underwritten by the state.

Northern Rock said it was "disappointing that new accounts will not be coveredbut reasssuring that people can reopen accounts they closed".

It is understood that up to 75,000 of Northern Rock's 1. …

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