Answer to Question #234886 in Management for Atiyah

Question

What could have been done differently to avoid the collapse of the Northern Rock Bank.

Answer 1

The UK government would have advised and assured the depositors of the bank that there deposits were safe even if the bank was receiving emergency liquidity assistance from the Bank of England. This would have gone a long way in keeping the bank up and running. The government would have put in place a comprehensive strategy like enhancement of co-insurance that would have served a great role of deterring depositors from taking away their money from the bank.

The national bank o UK would have strategized and put in place the process of receivership that would have assisted the management of the bank to rectify their wrongs doings so as to successfully return to operation.

The national government in the UK would have bailed it off to enable it resolves its issues and huge debts.