According to a story from Reuters, the Northern Rock disaster will continue indefinitely. The Bank of England will change the status of its emergency assitance loan to a loan term restructuring loan, as part of a wheeze to get out of EU state-aid retrictions.
It would be been better to declare this joke-bank bankrupt. However, good sense has long been in short supply at the FSA and the BoE.
The BoE will just keep pouring in money.
Northern Rock to have government loan extended: report
European Union guidelines currently block the bank from receiving state aid beyond February 17, but the newspaper said on Sunday that advisers to British Chancellor Alistair Darling had bowed to pressure from the firm and were working on a plan to change the status of the funding to 'restructuring aid'.
This would allow the Bank of England to continue funding Northern Rock indefinitely -- a move that could be crucial to any proposed takeover of the company. Northern Rock was forced to go to the Bank for emergency loans two months ago, as the global squeeze on credit markets caused its funding strategy to collapse.