Support for Northern Rock sale

November 22, 2011, 5:14 PM GMT+0

48% support sale of Northern Rock, 23% oppose; 50% say it was a good deal; 34% disagree

Nearly half of the British public support the sale of Northern Rock to Sir Richard Branson’s Virgin Money, our poll for the Sunday Times has found.

The results also show that a substantial half of people think the Government got a good deal in selling the bank at between £747m and £1bn, because they feel that the Government was always going to make a loss so such a return is still good, compared to around a third who feel the Government should have held out for a better deal.

  • Nearly half (48%) support the sale of Northern Rock to Virgin Money
  • Compared to 23% who oppose the sale
  • Half (50%) think the £747m-£1bn deal is a good one, because the Government was always going to make a loss anyway
  • While 34% think that the Government is losing too much money and should have held out for a better deal

Late last week, news broke that the Newcastle-based bank Northern Rock, which collapsed in 2008 and was subsequently taken over by the Government, had struck a deal with Virgin Money. Many commentators have since suggested that the buyout could bring stability back to Northern Rock and help restore public confidence in the banking sector.

A positive step?

BBC business editor Robert Peston has noted that the taxpayer will see a loss of around £400m-650m, but Chancellor George Osborne called the acquisition the first positive step in getting the British taxpayer ‘out of the business of owning banks’.

Meanwhile, Adrian Lowcock from Bestinvest has commented that the buying out of Northern Rock could be ‘quite transformational’ for Virgin Money, as it will move from a ‘comparatively small online offering’ to a ‘High Street banking presence’. Branson himself has said that the buyout will provide ‘an injection of new competition’ into UK banking, while Jayne-Anne Gadhia from Virgin Money has welcomed the assimilation of the two businesses, saying they will ‘complement each other’ and create a ‘strong bank’.

Protecting the workforce

The buyout has been particularly noted in the North East, as the bank is one of the region’s major employers. David Fleming, national officer for the union Unite, welcomed the buyout but highlighted that ‘it is now vital that Virgin Money gives Unite firm guarantees that the 2,500-strong Northern Rock workforce will be protected. Thousands of jobs were lost after the 2008 crisis.

‘It is now time to rebuild this iconic brand,’ says Fleming.

Following the acquisition of Northern Rock’s one million customers, the new Virgin Money bank will have around four million customers nationwide.

See the survey details and full results (page 8-9)