Rock could be catalyst for recovery

Sep 29 2009 by Neil Warwick, The Journal

THE anniversary of Lehman Brothers' collapse has prompted a flurry of articles, particularly in the legal press.

The Lawyer, trade magazine for the legal profession, dedicated one of its September issues to a series of articles reflecting on the thoughts of some of the key players in the administration. Two television programmes have been aired. Additionally, the anniversary has prompted two books dedicated to one of the other main American stories of 2007/2008 analysing, often very unkindly, the motives for the Madoff Ponzi scam.

According to these retrospectives, Lehman Brothers was put into administration on September 15, 2008. Thereafter, a global recession followed and according to many reports the world changed forever.

The North East to an extent was removed from the impact of the collapse of Lehman. However, arguably the shock of seeing the Northern Rock being put into public ownership was a greater dent to our collective confidence.

While trade and City press may reflect on the 12 months period after Lehman, it was pleasing to hear at a recent networking event the reaction from people who work at Northern Rock. One very simple statement sums up what is good about the North East, when a bank employee said “yes it’s been hard, but we couldn’t have done it without the support of the region”. What is often referred to as the parochialism of the North East can be viewed as a strength in difficult times.

There is now an opportunity as a region to try and emerge from the recession with innovative thinking. As with the recovery of Northern Rock, it will be hard to rebuild the regional economy. If the Conservatives are elected following the General Election, they will reinstigate the sales of shares in public assets to the general public. If this is the case, Northern Rock could be the ideal starting point. As the bank started as a mutual society, effectively owned by local people, it would be an elegant solution to sell shares back to the local people, proving that we genuinely do work together for the good of the region.

For information about how Dickinson Dees can help your business, contact Neil Warwick, partner, on (0191) 279-9375