THE Government has confirmed it will not intervene to save a bank’s charity organisation.
Bosses at the Northern Rock Foundation will have to start using savings after the nationalised bank refused to renew a generous funding arrangement.
The five per cent pre-tax profits previously handed to the foundation has been reduced to one per cent after the £15million-a-year, three-year deal expired.
But with Northern Rock losing more than £232million, the foundation will this year have to use £8million of its £38million reserves.
The Treasury said the bank is run as an “arm’s length” organisation capable of making its own day-to-day decisions.