Northern Rock's former chief executive, Adam Applegarth, will be entitled to receive monthly payments of about £63,330 over the next 12 months as part of a severance package from the mortgage lender, despite the lender being taken into government ownership earlier this year, The Telegraph reports.
Mr Applegarth is expected to receive the controversial payments, which come to a total of £760,000 over the year, despite criticism from shareholders who have seen the value of their holdings in the company virtually wiped out after it was engulfed by the credit crisis last year.
The payments are equal to Mr Applegarth's salary last year and can be cut if he takes a new job within the year.
The news comes as Northern Rock announced it made a loss of £167.6m in 2007. It has promised to repay its £24bn state loan by 2010.
THE US TREASURY secretary, Henry Paulson, will today propose the broadest overhaul of the US's system of financial regulation since the Great Depression in an effort to rebuild confidence in Wall Street's battered institutions, according to The Guardian.
Under the plan, the Federal Reserve would get extra powers to delve into the books of banks and brokerages if it suspected them of taking undue risks which could jeopardise the financial system.
Paulson wants the Fed to become one of three "super-regulators" replacing a galaxy of sector-specific watchdogs. It has already sparked protests from existing bodies over the shift in power from individual states to Washington.
THE WORLD’S BIG banks are to face stronger demands from finance ministers and central bankers of the Group of Seven (G7) leading economies to declare the full scale of their exposure to losses from the US housing market slump and the global credit crunch, The Times reports.
The G7 move comes after the Financial Stability Forum (FSF), the policy group of leading economies’ finance ministries, regulators and central banks, said at the weekend that lack of clarity over the extent of banks’ losses is worsening the credit crunch.
The G7 meeting at the end of next week between ministers and central bankers is expected to be accompanied by announcement of a UK-US working group to develop proposals to monitor the banking system.
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