Partner Article

Rock makes progress one year on

Savers are returning to Northern Rock in droves as the bank continues its recovery a year after being nationalised.

On the anniversary of the bank’s nationalisation, the latest available figures show the bank held £17.2bn in retail deposits at the end of September 2008, an increase of £3bn since the end of June and £6.7bn from the end of 2007.

The turnaround has taken place even though Northern Rock has to operate within strict competition rules.

State aid has been drastically reduced as part of the firm’s business plan agreed with ministers, resulting in most staff getting a bonus.

Details of any bonuses for the bank’s bosses will be disclosed in its upcoming annual report, although senior staff are subject to “more stringent” performance conditions.

But the Government’s requirement for rapid repayment has come at a price with the Rock forced to cut its mortgage book and make 1,300 staff redundant.

A Northern Rock spokesman said: “We have made very good progress but conditions are difficult.

“We had 777,000 mortgage accounts at the end of 2007, which had fallen to 662,000 at the end of June 2008 and had fallen below 600,000 at the end of 2008.”

He said the company’s workforce had fallen from around 6,000 to 4,500, with jobs lost through 1,300 redundancies - 500 of which were voluntary - and natural turnover.

This was posted in Bdaily's Members' News section by Ruth Mitchell .