I know I shouldn\’t say it, but it looks like the man actually did something sensible. How it grates to say it though….
Speaking to the BBC\’s business editor Robert Peston for a File on 4 programme tonight on Radio 4, Mr King said the emergency talks broke down after Lloyds demanded a £30 billion Bank of England loan at competitive rates as part of the deal.
Critically, he said he told Mr Darling this was "a matter for government" to decide.
The governor said: "I said to the Chancellor, \’This is not something which a central bank can do: they don\’t normally finance takeovers by one company for another – let alone to the tune of £30 billion, which is rather a large amount of money\’.
"So I said, \’This is a matter for government, but you have to recognise that if you were to make available such a facility to one bank, you would have to make it available to any other potential bidder and therefore it will become public.\’
"And I don\’t think it took the Chancellor very long to recognise that not only was this something which central banks don\’t do, it\’s also something that governments don\’t do."
For of course, any such deal would have rescued the shareholders in Northern Rock. Exactly what shouldn\’t happen. Preserving the financial markets, yes, but preserving the wealth of those who have gambled and lost, no.