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Northern Rock’s borrowing from Bank of England slows significantly

Northern Rock’s emergency borrowing from the Bank of England has decreased significantly to just £500m in the last week.

The BoE published figures showing its balance sheet had expanded by just £500m in the last week to November 7.

Previous weekly amounts borrowed by Northern Rock have been around the £2-4 billion mark so this week’s rise is the smallest since the Northern Rock crisis broke.

The other assets on the BoE’s balance sheet has increased by £23.3bn since September 12, but Northern Rock’s share of that sum is believed to be around £20bn.

But New Star economist Simon Ward says he believes the loan could reach as high as £30bn.

He says: “With deliberations on Northern Rock’s future dragging on the loan seems likely to grow further and may approach £30bn, the amount requested from the BoE by Lloyds TSB as a condition of its aborted rescue takeover.

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