Citigroup throws a AGBP10bn lifeline to Northern Rock.

Investment Adviser, October, 2007

Further speculation grew last week over Northern Rock's future, with Citigroup stepping into the fray to offer a reported AGBP10bn credit line.

Under the terms of the expected deal the world's biggest bank will replace the Bank of England as Northern Rock's main creditor. Reports suggest Citi will lend between AGBP5bn-10bn in additional funding, but below the penal interest rate of 7 per cent applied by the BoE.

Citigroup remained tight-lipped last week, with a spokesman refusing to confirm or deny whether the deal would go ahead.