N Rock: customers 'withdraw £10.5bn'

Updated 12.43 Thu Nov 08 2007

Keywords: Bank of England, mortgages, bank, Northern Rock

Northern Rock shares tumbled 12 per cent after reports that £10.5 billion has been withdrawn by customers from the crisis-hit lender.

It follows the bank being forced in September to turn to the Bank of England for emergency funding which resulted in queues of panicked people seeking to withdraw their savings.

The £10.5 billion represents almost half the £24 billion in retail deposits held by the bank

The £10.5 billion represents almost half the £24 billion in retail deposits held by the bank.

Northern Rock was also the leading faller in a turbulent start for London's FTSE 100 Index, which lost 80 points in early trading.

The falls followed heavy losses on Wall Street overnight, as Morgan Stanley became the latest investment bank to warn of major write-downs following the sub-prime mortgage crisis in the US.

The bank's losses on mortgage-related debt could potentially reach $6 billion (£2.85 billion).