Northern Rock have today announced that they are in talks regarding a number of potential transactions, one of which is a possible buyout of the troubled bank.  This comes hot on the tail of last weeks cancellation of the interim dividend to shareholders, which would have cost the bank in excess of £50 million, at a time when it is being bailed out by the Bank of England.  Quite how they really expected to be in a position to pay the dividend had shocked many in the City, but pressure from the Bank of England seems to have prompted the about turn in policy.

While a number of parties have been mentioned in connection with a takeover, merger or refunding of the group, there are many experts who feel that the company is just treading water at the moment, with not one of the major banks showing any interest.  There is no doubt that the brand is nearing a death, and while there are mortgages and banking customers to pick up, why bid for these when you could pick them up free if the company goes under?

In a separate development, the management of Northern Rock have been called to appear before an MP’s Treasury Select Committee next month, in what promises to be a stormy affair if the recent grilling of Bank of England governor Mervyn King is anything to go by.  Mr King’s own position has been the subject of much debate over the last few days, with Prime Minister Gordon Brown unwilling to answer questions on the subject.