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Northern Rock Abandons Offshore Arm of its Business

Most of us are well aware of the problems that Northern Rock has had in recent months.  To try and protect savers from being tainted by the problems experienced during the downturn, when mortgages were being defaulted on, the company was divided into two distinct sections.

From what I have read recently it would now appear that the next step in the process is to get rid of the offshore arm of its business completely.  The offshore section is based in Guernsey, and some six thousand customers have been notified of the change.  They will have to find alternative arrangements as a direct consequence of the decision.

The closure is set to take place at the beginning of September – the 2nd – this year.  This gives all the customers some time to cancel their accounts and put their money elsewhere.  I will be interested to see how many people do this immediately, instead of waiting to see what happens nearer the time.

It will also be interesting to see how the future of Northern Rock pans out.  We can all remember the pictures of queues of people waiting to take their money out as Northern Rock ran into severe problems a while back.  This move to close the offshore operations is the next stage in a long and difficult process – arguably difficult for all the customers as well as the bank itself.  The idea is that eventually the bank will be privately owned again, instead of being owned by the government.

Regardless of whether you have been affected by the forthcoming closure in Guernsey or not, or any other aspect of the events at Northern Rock, contact us here at St Matthew now to discuss the tax implications you may have regarding your savings.


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