Northern Rock has failed to persuade its leading shareholders to abandon demands for an emergency meeting and has only until Christmas Eve to fix a date for what could be an embarrassing face-off with investors. Financial Times, Independent

Bryan Sanderson, the chairman of the troubled bank, has intervened personally in efforts to talk round RAB Capital and SRM Global, the two hedge funds that called the EGM, but had no success, people familiar with the talks said.

The emergency meeting, expected in mid-January, could give the hedge funds and 140,000 disgruntled private shareholders in the bank a highly visible platform to lambast the bank’s sale process.

One Northern Rock insider said it would be 'unhelpful' for the meeting to go ahead and they still hoped to persuade the funds to back down. But the deadline to send out documents for the EGM is next Monday.

SRM Global Master Fund, the hedge fund that is Northern Rock's biggest shareholder, continued to build its stake in the bank yesterday even as expectations for nationalisation increased.

SRM, run by Jon Wood, a former star UBS trader, now owns nearly 10% of the troubled lender after announcing an increased stake each day this week.