Saturday, September 15, 2007

This can't be good

Long queues formed outside branches of Northern Rock today as anxious customers waited to withdraw savings after the bank was forced to seek an emergency bailout from the Bank of England.

Savers went in person to Northern Rock's branches to withdraw their money, after facing difficulties contacting the bank on the phone or via the internet.

Customers who manage their money on the internet were blocked from seeing details of their account, including statements, when they tried to log in.

This morning Northern Rock gave warning that its profits would fall by 23 per cent, and its shares have dropped by nearly a quarter in value, after problems in the global credit markets forced it to ask for emergency financial support.

William Gough, 75, arriving at a Northern Rock branch in Central London this morning, said he did not believe the bank’s assurances that his savings were safe and intended to withdraw his funds.

“They’re telling us not to worry but we’ve heard it before, with Marconi”, he said, referring to the collapse of the telecoms equipment firm in 2002.

“At the time I put the money in I wouldn’t have imagined something like this would happen,” Mr Gough said while joining the back of a 40-strong queue.

Customers queued for up to an hour and, as news of the Bank of England bailout spread, the throng inside the branch was so dense that some struggled to open the door. from the London Times

I continue to hear things about the economy that look really grim. A run on the bank? A literal panic? When is the last time something like this happened? I can't find any reference to a bank run in the Anglo world since the Great Depression.

No comments: