LONDON (AFP) — Britain's finance minister Alistair Darling has asked Goldman Sachs to put together a financing package in a last-ditch bid to rescue the ailing bank Northern Rock.
The Financial Times said Saturday the chancellor of the exchequer asked the US investment bank to become involved on Friday to help find backers for a speedy private sale.
Northern Rock was severely damaged by the global credit crunch sparked by the US home loans crisis and was forced to apply to Britain's central Bank of England for emergency funds in September to stay afloat.
Richard Branson's Virgin Group and the Olivant investment group are vying to assume charge of the bank, but are reportedly struggling to find the capital for the takeover and repay billions in tax-payer-backed loans.
The FT said Goldman Sachs has until mid-January to see if it can assemble backers and it was "the last throw of the dice" from Darling.
If it fails, the government is reportedly drawing up nationalisation plans as a contingency, which could spell disaster for Prime Minister Gordon Brown, who forged a reputation for economic competence as Darling's predecessor.
"Northern Rock's decision to call in the US bank is a sign of its lack of confidence in the ability of its suitors to assemble finance in turbulent market conditions," the newspaper said in a front-page article.
Northern Rock is to drop out of London's leading FTSE 100 share index on December 24. Its share price stood at just under 92 pence at close of trading on Friday -- down from nearly 700 pence in early September.
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