Northern Rock Shares Crash as Customers Queue
September 14th, 2007UPDATE: Police Called to Disperse “Panicked Crowds” of Northern Rock Customers Trying to Withdraw Money
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Remember that number I told you to watch for on gold? $721.
It reached $718 today.
Via: Telegraph:
Thousands of panicked Northern Rock customers have rushed to withdraw millions of pounds out of their accounts, as fears for the future of the bank sent shockwaves throughout the City and caused its shares to crash.
The bank’s phone lines were jammed for most of the day, its website crashed and the company’s 72 branches were besieged by worried customers after it admitted being forced to ask the Bank of England for emergency funding.
The unprecedented scenes came as the financial turmoil that has engulfed the money markets in the past month spilled out on to the High Street.
On a day of widespread concern over the future of the economy:
Northern Rock’s shares fell by almost a third, leading to speculation that the bank – the UK’s fifth largest lender – could be put up for sale.
Other major lenders including Bradford & Bingley, Coventry and Paragon to issue statements insisting they were not in similar trouble
The Chancellor appealed for calm and insisted that both the banking system and the economy were stable
The Bank of England’s decision to help Northern Rock – by guaranteeing funds of up to £35 billion – is the first time since 1973 that it has bailed out a High Street lender.
Research Credit: PD
I wasn’t surprised to see stories like this from the US because we’ve heard so much about how fragile things are over there but I hadn’t heard so much about the situation in the UK – have there been the same warning signs
and more importatnly to me, are there the same (imminent) warning signs here in NZ?