The government has told the two groups bidding for Northern Rock to improve their offers or see the troubled bank put into full public ownership, reports The Guardian.
According to reports, the Treasury has told both Sir Richard Branson's Virgin Group and the rival in-house management team that their current bids are less attractive than nationalisation, something that once appeared anathema to Gordon Brown.
The BBC reported last night that Virgin has been asked to improve its bid so that it pays more for the billions of pounds of loans the government is providing to keep Northern Rock afloat. The current £1.25bn offer, made on February 4, involves a £500m rights issue and a £500m cash injection, plus Virgin Money.
However, Virgin has also been told that its offer – even as it stands – is significantly superior to the in-house proposal. This puts pressure on the management team to also raise its terms.
It also sent Northern Rock's shares tumbling almost 8% in early trading, down 8p to 97p.
THE OPERATOR OF THE BlackBerry wireless email network still does not know what caused the system failure that crippled hundreds of thousands of American users on Monday afternoon, reports The Telegraph.
Research in Motion (RIM)), which owns and runs BlackBerry, said it was too early to tell what caused the "critical severity outage" which affected around 50pc of North American customers for about four hours. RIM shares fell 29 cents to $94.18.
The collapse follows a nine-hour outage in April 2007, which led to a backlash from users.
WARREN BUFFETT, THE world’s third-richest man, boosted shares on both sides of the Atlantic yesterday after offering to prop up the beleaguered bond insurance market, reports The Times.
Mr Buffett offered to reinsure $800bn (£408bn) of local American government securities, assuming the insurance liabilities for “municipal” bonds underwritten by MBIA, Ambac and Financial Guaranty Insurance Co (FGIC), three of the biggest securities insurers.
His Berkshire Hathaway investment vehicle has set aside $5bn for the plan. Mr Buffett told CNBC that one of the three monoline insurers had rejected his offer and he was waiting to hear back from the other two. He did not name the party that had refused.
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What made financial headlines over the weekend?
To promote 'long-term investment'
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