Rescue package approved
THE European Commission has approved the Government’s emergency rescue package for Newcastle-based Northern Rock.
Officials said there had been no breach of EU state aid rules surrounding the terms of the temporary bail-out of the mortgage bank - but warned that any longer-term restructuring plans would have to run the gauntlet of EU competition authorities again.
A statement said the approval “has no bearing on whether any future measures taken by the UK authorities to support a restructuring plan would be similarly approved”.
EU Competition Commissioner Neelie Kroes commented: “This case shows that, with good co-operation from the member state concerned, the Commission can move very fast to provide legal certainty for temporary rescue measures.”
The Bank of England announced bail-out plans in September, routinely notifying the Commission, which vets all state aid to industry for possible unfair competition contrary to EU laws.
