Bank chief defends role in crisis

Bank of England governor Mervyn King is defending his handling of the Northern Rock crisis in a crucial appearance in front of a panel of MPs.His job could be on the line, with discussions under way on whether to renew his five-year term in June.

Robert Peston blogs about the Unstable Governor,

If it had done this three weeks ago when banks were clamouring, Northern Rock might never have feared that it was running out of money.

So it would not have had to approach the Bank of England for emergency support.

And there would never have been that infamous run on Northern Rock – the first run on a British bank for 140 years.

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So, although the Bank of England has changed course in respect of the way it is prepared to tackle the crisis in the money markets, it is sticking to the position that it has no regrets about the way that it provided its initial support to Northern Rock.

Read related stories in the sidebar for full coverage on the Northern Rock issue.