Photo: Dominic’s pics via Flickr
The British government has sold previously troubled bank Northern Rock plc to Virgin Money for £747 million ($1.18 billion) reports the BBC. The sale of the bank has already led to some critcism, with The Sun running the headline “Northern Rock sold to Virgin … costing taxpayers £400million”.
The bank was nationalized in 2008 after it nearly folded during the financial turmoil. According to Reuters the bank hit trouble when it announced in September 2007 that the Bank of England was providing it with support. The banks shares crashed and thousands of customers began withdrawing their money.
By February of 2008 the bank was in public ownership. Over the next three years the bank was split up into a “bad bank” with most of its toxic loans and a “good bank” which was to be sold. Now, Virgin Money has succeeded with a bid for Northern Rock that it made in October.
According to the BBC, Virgin Money is expected to pay an additional £200 million ($316 million) in the coming months. The final sale of the bank is estimated to go through in January. The organisation also estimates that since 2008 £1.4 billion ($2.2 billion) of tax payers’ money has been pumped into the bank.
It was also reported that the government had no plans of selling the “bad” part of Northern Rock which still has debts in excess of £21 billion ($33 billion).
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.