Northern Rock reports falling losses in 2009

by Richard Kilner

Story link: Northern Rock reports falling losses in 2009

State-owned bank Northern Rock has seen a substantial reduction in its annual losses, the BBC has reported.

The bank lost £257.4m in 2009, down from £1.36bn the previous year, with underlying losses (excluding one-off gains) of £383m.

It also means that Northern Rock has done better than 2007, when it incurred losses of £585m.

The bank was amongst the first major casualties of the financial crisis, which necessitated government action and the nationalisation of the institution to prevent its collapse.

Chief Executive Gary Hoffman has waived his bonus, and will only receive one when the firm either returns to the black or is sold.

Other employees of the bank were given bonuses of £13.4m, which entails a total tax burden of £1.5m.

In February it was announced that the 100% guarantee for Northern Rock savers will be removed on 24 May, although customers will remain protected by the Financial Services Compensation Scheme (FSCS) which will guarantee up to £50,000 per individual.