Northern Rock shareholders ‘must be compensated’

Northern Rock shareholders ‘must be compensated’

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The Government has a “moral justification” to pay billions of pounds in compensation to people who lost money when Northern Rock was nationalised at the start of the credit crunch, a campaign group says.

It was 10 years ago that Northern Rock, which had expanded too fast and taken on too much mortgage debt, was forced to go to the Bank of England for emergency financial assistance.

The move caused the first run on a British bank for 150 years as savers, worried they might lose everything, formed queues outside branches to withdraw their money.

:: Northern Rock – how the bank changed the country

When the bank was subsequently nationalised, at least 160,000 shareholders lost their investments.

Former Northern Rock worker Dennis Grainger is chairman of the Northern Rock Small Shareholders sub-committee.

He has spent the last decade heading a campaign to recover their losses and is sending a report commissioned by the UK Small Shareholders Association to the Prime Minister.

“Her people should be able to say to her: ‘There’s been an injustice done here’,” he said in his office in his bungalow in a village outside Newcastle.

Most of the £37bn of taxpayers’ money used to bail out Northern Rock has already been recovered by the Treasury.

It is expected that the Treasury will also receive at least £4.5bn more from the body it set up to manage the bank’s loans.

“Is she going to put the money under the pillow… and keep it like an asset stripper and use it for what they want?” Mr Grainger asked.

“Where is the fairness?

“Where is the justice?”

(c) Sky News 2017: Northern Rock shareholders ‘must be compensated’