Rock's Bank loan to be transferred to Treasury

British mortgage lender Northern Rock's £17.5 billion-worth ($34.2 billion) of Bank of England debt will be passed on to the Treasury, it emerged Tuesday.

The transfer will take place in the second half of this year subject to the approval of the European Commission, which has strict rules regarding the provision of funds deemed state aid. If the transfer goes ahead, the Treasury will loan back £3 billion to the lender so that it can improve its tier one capital ratio.

The lender also revealed

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