Mervyn King, Bank of England governor appeared to blame Alistair Darling, chancellor, for failing to act more urgently to head-off a banking crisis of the kind that engulfed Northern Rock, while the Treasury and Bank of England denied they were at loggerheads and King also cast don't on Northern Rock's version of events. Financial Times, The Times, Daily Telegraph, Independent, Guardian.
King denied last night that he had sought to apportion blame. But he drew Treasury irritation by confirming publicly that Mr Darling had decided, alongside the Bank, that it should not sanction the loan of up to £30bn.
The Treasury and the Bank of England denied being at loggerheads over the handling of the Northern Rock crisis last night after the Conservatives claimed that an interview by Mervyn King, the Bank’s Governor, proved that Alistair Darling, the Chancellor “flunked” key chances to prevent the run on the failed lender.
The Governor has cast doubt on a public claim by Adam Applegarth, chief executive of Northern Rock, that the mortgage lender could have avoided financial meltdown if the UK central bank had pumped more cash into the money markets.
He said: “I don’t want to accuse anyone of being misleading, but I find that very hard to square with the facts.”