Northern Rock should not be allowed to complete a planned restructuring without paying financial penalties, Britain’s building societies have told European competition regulators, on the grounds that the nationalised mortgage lender will otherwise have an unfair advantage.

In its submission to the European Commission, the Building Societies Association (BSA) argued that Northern Rock should be forced to pay a fee as a condition of European state aid approval to prevent any distortion of the mortgage market.

Daily Telegraph, The Independent