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The European Commission has conceded publicly that Northern Rock will have to downsize if it is to map out a future in line with EU state aid rules. In comments to the press today, a commission spokesman stressed the regulator "is not asking for redundancies."
"But to be viable without state guarantees it is clear the bank must shrink" the spokesman continued.
The official was responding to questions regarding concerns voiced by a number of Danish banks alleging Northern Rock was enjoying an unfair advantage with the state help it has received to date.
"We can confirm the commission has received a letter from the Danish banks" the commission spokesman said.
"Fair competition must be ensured between all banks."
He also confirmed receiving UK Treasury's notification for the bank's restructuring plan yesterday, ahead of a
By Duncan Lumsden