Northern Rock: Are you entitled to an interest repayment?

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Northern Rock
People walk past a branch of the Northern Rock bank in 2009. Photo: REUTERS/Andrew Winning

Will Northern Rock be sending you some money?

Northern Rock is paying thousands of customers massive refunds. It may be good news for them - but it is not so good for the rest of us.

That's because, as taxpayers, we own Northern Rock Asset Management - the state owned rump which is what remains of the ill-fated bank.

So what has Northern Rock done wrong?

The old bank - before the state was running it - wrote letters to some loan customers which did not comply with the Consumer Credit Act.

Specifically, they did not contain details of the original loan figure for each individual - which is a legal requirement.

Now the lawyers for this part of Northern Rock have advised them to make refunds:

  • £270 million will be repaid.
  • 152,000 customers will get payment.
  • Northern Rock owes taxpayers £19.6 billion.

What should people do?

This does not involve all Northern Rock customers - there are a total of 400,000 of them.

This is just the 152,000 with secured loans. The refunds will be the total amount of interest paid since the error was made in 2008.

I'm told letters will go out "in the next few days" - so customers at this stage need not do anything.

This was not a deliberate rip-off. It is not mis-selling. I'm told that nobody has been financially damaged.

It was more a technical breach of the law. It is interesting to note that they have not received any complaint or claim as a result of this.

Yet it means that the bank that has already cost taxpayers billions - is about to cost us millions more.

  • Are you expecting a repayment from Northern Rock? If so, ITV News would like to hear from you, send us an email to yourstory@itn.co.uk.