Business

Northern Rock in Guernsey to shut

Northern Rock sign
Image caption Northern Rock has gone through some significant changes

Northern Rock's banking operation in Guernsey is to close on 2 September, the bank has announced.

Some 6,000 customers have received letters giving them three months' notice to close their accounts.

The bank said that the Guernsey operation no longer met its "long-term commercial objectives" following a review of offshore operations.

The Rock's customers recently lost the 100% safety net on their savings as government ownership nears an end.

Now the guarantee has reverted to each saver's first £50,000 - as is the case with other banks not backed by the government.

Changes

The bank said the priority was to ensure that all customers were treated fairly as the Guernsey operation is wound down.

"The board considers the closure of our Guernsey operation to be a necessary step as we continue to prepare the company for a return to private ownership and to deliver value to the taxpayer," said Gary Hoffman, the Rock's chief executive.

"The closure will be conducted in an orderly manner, over a three-month period, and we aim to make the process as easy as possible for customers."

Deposits will be accepted into customers' accounts, such as standing orders, until 2 July. Any payment received after that will be returned to the sender.

Customers are being asked to make arrangements for any automated payments to be cancelled before 2 July.

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