Northern Rock relaunched to boost mortgage market

Feb 23 2009 by Graeme King and William Green, The Journal

Why there had to be a change

THE Journal’s Give the Rock a Role campaign called for the Government to use the Newcastle-based bank to help revive the economy.

As part of the nationalised bank’s requirement to repay a taxpayer loan, it was driven to redeem mortgages and ask customers to seek loans elsewhere.

But that only exacerbated problems already being faced by homeowners.

Parliament and business chiefs, including respected Liberal Democrats’ finance spokesman Vince Cable, backed the campaign, focusing on the £15.4bn of the £26.9bn debt the nationalised bank had already repaid.

Blaydon Labour MP Dave Anderson, Newcastle Central MP Jim Cousins and David Clelland, Labour MP for Tyne Bridge, also threw their support behind our calls.

A week after the campaign was launched the Gosforth-based bank announced it was slowing the rate of its mortgage redemption.

The following day Chancellor Alistair Darling told MPs he was considering how Northern Rock could best support "prudent" lending to credit-worthy customers who needed mortgages, but could not afford deposits of 25%.

He said it was no longer "the right thing to do" to drive consumers from Northern Rock