Bank upbeat after posting £232m loss

Ron Sandler, Northern’s Government-appointed chairman, said the £232.4m pre-tax loss for 2010 was “disappointing” but insisted progress was being made as the shortfall narrowed in the latter half of the year.

While Mr Sandler was not eligible for a bonus, the bank’s 4,500 staff, who on average earn £20,000 a year, will share a pool of £13.1m.

The results were met with scorn from union leaders, as Unite national officer David Fleming said the progress had “come at a heavy price”.

He added: “With over 2,500 staff having paid with their jobs for the scandalous behaviour of the previous management, this gradual recovery is not enough.”

Northern Rock was nationalised in February 2008 after it collapsed amid the credit crisis, sparking the first run on a UK bank for 150 years.

The Government split Northern Rock in two at the start of last year, forming a mortgage and savings bank called Northern Rock plc and Northern Rock Asset Management (NRAM) to house the more toxic loans.

Yesterday’s losses were attributable to the “good bank” Northern Rock Plc, with “bad bank” NRAM, which was merged with Bradford & Bingley to form UK Asset Resolution, due to publish its results later this month.