Your account is now owned by Virgin Money, not Northern Rock. Virgin can not change the terms and conditions of your account without prior notification.
For customers with fixed rate bonds or accounts with fixed bonuses, these will have to be honoured.
Virgin Money and Northern Rock are to keep their separate banking licences in the short term. This means that you can have up to £85,000 (or £170,000 in a joint account) saved with each licence, and have your money fully protected by the Financial Services Compensation Scheme.
All new Virgin Money accounts (from 5.1.12) will actually operate under the Northern Rock licence. However, all Virgin Money savings customers who opened accounts prior to this date will fall under Virgin's banking licence not Northern Rock's.In the longer term it is likely that the banking licences are brought together as the banks become one. You'll be informed nearer the time, but it's best to be aware of this, to make sure you don't exceed depositor protection limits later on.
(and loan borrowers)
Are you a customer of Northern Rock plc, or Northern Rock Asset Management? A lot of mortgage and loan customers have been segregated to Northern Rock Asset Management. This bank was not sold to Virgin Money. If you are in any doubt, check whether you are a customer of Northern Rock, or Northern Rock Asset Management.
Northern Rock Plc. customers Mortgage and loan customers on introductory fixed or tracker rates will have these deals honoured. Other terms and conditions will not be changed without prior notification. However, your mortgage may well be subject to a different interest rate when you end your introductory fixed or tracker rate deal.
When Northern Rock was independently valued in 2009, it was found that the shares held were worth nothing. This remains the case.
The purpose of this sale is to recoup some of the Government's direct investment in the bank since it nearly failed in 2007.
As taxpayers we're going to make a 'small' loss on the sale of Northern Rock. The bank was bought for £747 million – substantially less than the £1.4 billion we originally took. In addition to the £747 million, Virgin Money will pay an extra £50 million within six months of taking over, with a further £150 million being paid as a Capital Instrument (bonds or shares) later on.If Northern Rock is floated on the stock exchange, or sold for a profit within the next five years, Virgin Money will pay the Government a further £50-80 million.In total though, even with these future payments, the Government will not get back what it put into the Rock.
Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.
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