Nationalisation of Northern Rock was "a good thing", Ron Sandler, the man charged with running the stricken bank, yesterday assured its 6500 staff who are worried about their future.
The UK Government's £90,000-a-month choice to head up the crisis-hit Newcastle lender declared how temporary public ownership gave the bank "a period of stability and a chance to pull back from some of the forces that have buffeted it in previous months, a chance to regroup and move forward".
He said: "My message to staff is a positive message." However, the renowned City troubleshooter, who restored confidence in Lloyd's of London after years of financial turmoil, remained tight-lipped about possible job cuts.
He stressed while Northern Rock was well-placed to recover from the problems caused by the sub-prime housing debacle in America, "nothing is guaranteed in this world".
Mr Sandler confirmed it would be "some years" before the government loans were repaid in full. He suggested the bank would not close to new business, despite speculation that it would have to turn down customers as it was trimmed in size.
"It's business as usual," said the new bank chief. "Your money is safe if you're a depositor or a prospective buyer." He made clear Northern Rock aimed to "compete vigorously" despite being placed in public ownership but he admitted its operations would be constrained by EU rules.
It is not yet clear how these will restrict new business although it is understood the mortgage lender might not be able to offer aggressively competitive products as it could be deemed to have an unfair advantage over competitors.
The European Commission approved a government package of rescue aid for Northern Rock last year. However, this approval expires on March 17 and any new national aid plan injecting funds into the bank would also need to be authorised and vetted for compatibility with state aid rules.
In the Commons, Alistair Darling faced Tory taunts as he argued that nationalisation of Northern Rock was in the best interests of the taxpayer.
He explained the bank's new board would "operate at arm's length from the government with commercial autonomy for their decisions".
He reassured savers and borrowers that their money was "safe and secure".
However, George Osborne, his Tory shadow, accused the government of months of "dither and delay", and said nationalisation amounted to the "slow, lingering death of Northern Rock and Britain's reputation as a major financial services centre" with Mr Darling cast as the "undertaker".
Mr Osborne demanded a full statement on Northern Rock's financial position and the Goldman Sachs's advice before MPs debated the emergency legislation today.
He said it was unacceptable for the bank to continue with "business as usual" given it could now borrow and lend more cheaply than its high street competitors. However, Mr Darling hit back, accusing Ms Osborne of "cynical opportunism" and never having had a consistent policy on the situation.
Vince Cable for the LibDems, who has long argued for temporary nationalisation, berated the Tories for suggesting public administration under the Bank of England. "What is that but nationalisation in all but name?" he asked.
Mr Cable added Mr Osborne was "so determined to keep one foot on either side of the fence dividing the public and private sector that he is in imminent danger of being castrated by the serrated edge".
Labour's Doug Henderson, an ex-minister who represents Newcastle-upon-Tyne North, welcomed the UK Government plan and called for early publication of the business plan to bring stability.
However, Ken Clarke, the Tory former Chancellor, said the only case for nationalisation was "to make an orderly run-down of the bank with the sale of the loan book as and when the markets permitted".
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