Northern Rock Shares Still Less Than Worthless

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The current owners of Northern Rock today announced their plans for the nationalized bank. The former owners? There will be no compensation for their shares under their Christmas tree.
Andrew Caldwell, the independent valuation expert who's been working through the Northern Rock mess for more than a year, is warning that investors in the bank are entitled to nothing for their shares. In a preliminary report, he concludes that there was simply no way the failing lender could repay the British government the £25 billion pounds it needed two years ago to stay afloat. Caldwell says it would have come up more than £5 billion short.
Pity.


There's still a slim chance Caldwell will change his mind: He says he's still in the "consultation" phase and will accept comments, complaints, hate mail and other constructive responses until Jan. 29.
By which time there will actually be two Northern Rocks. The British Treasury today ordered the legal and capital restructuring of the lender, which will create separate asset management and banking divisions. One thing, however, will not change: The bank will remain the property of the British government.
Northern Rock investors will not get compensation [Guardian]
Northern Rock: HM Treasury Orders Legal, Capital Restructure [WSJ]

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