23
Feb
New Northern Rock mortgage strategy unveiled
The government has unveiled Northern Rock's new lending strategy,
which will see the nationalised bank increasing its mortgage
provision.
Under the plan, the bank will offer £5 billion of new lending
this year and a further £9 billion next year, as part of a
wider government initiative to try to increase lending to stimulate
economic recovery.
Such a move represents a reversal of the previous strategy of
Northern Rock since nationalisation, which has seen it running down
its mortgage book.
Last month the Treasury announced that this policy was to be
changed.
As well as owning Northern Rock and Bradford & Bingley, the
government also has large stakes in Lloyds TSB and the Royal Bank
of Scotland.
Last week Liberal Democrat Treasury spokesman Vince Cable said the
government had "in effect" nationalised these banks and should be
directing them to lend more.
