Amongst other more exciting stories today, the EU commissioner (Neelie Kroes, pictured) has as expected cleared the UK Government on the Northern Rock bail out. Interestingly the wording is vague enough to allow for a continuation of the situation beyond the normal 6 month deadline:
"These aid measures can be authorized as rescue aid in line with Community guidelines for rescuing and restructuring firms in difficulty...Under those rules, rescue aid must be given in the form of loans or guarantees lasting no more than six months, although certain exceptions in the banking sector to allow for prudential requirements, have been applied in this case."
So the Government may see light for an extension here is the auction process falls apart. This may happen, as although the Government is desperate for Branson to win, if the NR has virtually no savings at all after Xmas, which is a possibility, then really there is only a distressed book to sell off.
As Hatfield Girl pointed out in the comments yesterday, the EU is currently looking to expand its regulations on financial services over the UK. I have a hunch that it sees this as a very useful stick to beat us with and therefore is quite willing to leave our regulatory authorities and government swinging in the wind and giving them less room to manoeuvre out of greater EU interference with our Financial market regulations.