BusinessCompany NewsNorthern Rock shareholders take fight to High Court

Northern Rock shareholders take fight to High Court

A hedge fund and 150,000 small shareholders have joined forces to take their fight for greater compensation to court

A hedge fund and 150,000 small Northern Rock shareholders intensified their
push for greater compensation from the government following the nationalisation
of the Newcastle-based lender.

SRM
Global
, the Monaco-based fund which held 11.5% of Northern Rock, has joined
the
UK
Shareholders Association
, representing private investors who had a 25%
stake, to formally ask the High Court to investigate the legality of the conduct
of the government, the Bank of England, HM Treasury and the Financial Services
Authority.

Moreover, they are demanding a review of the government’s proposed
compensation scheme, criticising it for mishandling the lender’s nationalisation
and for acting unfairly.

The Financial Times reports HM Treasury has a firm view the
statutory framework for the assessment of compensation, including the
assumptions which the valuer will apply, represents ‘a fair and reasonable basis
for determining any compensation payable to former shareholders’.

Further reading:

Rock valuer hunt drags on

Risk lessons from the FSA

Read
the Financial Times story

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