Bank Meltdown Wallops the British Market

Thousands still lining up outside branches; spiral could hurt PM
By Sam Gale Rosen,  Newser Staff
Posted Sep 17, 2007 8:34 AM CDT
Customers stand in a queue outside a branch of the Northern Rock the British mortage lender in Harrow, London Monday Sept. 17, 2007. Shares of British mortgage lender Northern Rock PLC, hit by a liquidity...   (Associated Press)
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(Newser) – Shares of British mortgage lender Northern Rock crashed again today, causing heavy losses in other banks and deflating the FTSE 100 index by more than 100 points by midday. The bank's stock fell 36%, bringing the loss to 78% of its value in the past year. The spreading malaise is expected to bring an abrupt end to the British housing boom, and could damage the new government of PM Gordon Brown

Despite an infusion of cash from the Bank of England and assurances that deposits are safe, thousands continue to line up outside the bank's branches, eager to recover their money. Many are bringing chairs and refreshments. Analysts are now saying that a takeover may be Northern Rock's only hope, but any potential buyer would have to move fast.