HM Treasury

Newsroom & speeches

Northern Rock Frequently Asked Questions (FAQ)

What is the Transfer Order?

The Transfer Order is a statutory instrument made under the Banking (Special Provisions) Act 2008. This legislation is an important part of the process that will enable Northern Rock to be restructured.

What will the Transfer Order do?

The Transfer Order will provide for the restructuring of Northern Rock into two separate companies:

When will the restructuring happen?

The restructuring will be effective from 1 January 2010.

Does the Government plan to sell Northern Rock plc? If so, when?

Yes, the Government intends to return Northern Rock plc to the private sector when the time is right and it can achieve value for money for the taxpayer. The Government does not believe it is in the public interest for it to operate banking services in the longer term. Returning Northern Rock to the private sector will increase competition in UK banking, bringing benefits for consumers.

What will happen to Northern Rock (Asset Management) plc in the long term?

Northern Rock (Asset Management) plc will be wound down under Government ownership, and will not hold deposits or offer any new lending. The Government’s interest in Northern Rock (Asset Management) plc will be managed by UK Financial Investments.

Why have new guarantee arrangements been announced today?

As a result of the Transfer Order, Government guarantees in relation to Northern Rock need to be restated to apply to the two entities. All deposits continue to be guaranteed under the new arrangements. These new guarantee arrangements will come into effect when Northern Rock’s business is split on 1 January 2010. In the meantime, the existing guarantee arrangements remain in place.

I’m a customer of Northern Rock, what does it mean for me?

For Northern Rock customers it’s business as usual and you do not need to take any action. Further information for customers is available from Northern Rock (external).

Back to top