UK Treasury ponders B&B bank nationalisation

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UK Treasury ponders B&B bank nationalisation

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Nationalisation of the troubled Bradford and Bingley mortgage lender in the UK cannot be ruled out say Treasury officials.

The government says talks on the bank’s future are ongoing. It would be the second British bank to be nationalised this year after Northern Rock was taken into public ownership in February.

B&B’s share price tumbled after it announced plans to cut 370 jobs.

Government officials have been in talks with bank executives from HSBC, Santander and Barclays in an effort to hammer out a formula to save the mortgage lender.

An announcement’s expected this evening or early on Monday.

In Belgium financial authorities are examining ways to restore confidence in Fortis. The banking and insurance group is seeking to reassure investors it is solvent and in no danger of collapse after announcing deals to sell of parts of its business.

Belgian Finance Minister Didier Reynders promised government backing for any deal.

“We must get off on the right foot from next week,” he said. “You’ve seen over the last few days, the market situation was very difficult, we wil see with different players if they can take initiatives. If so, the government is ready to go.”

Fortis is the biggest private sector employer in Belgium. One and a half milion households bank with the group, that’s roughly half the country.