MPs demand action

MINISTERS faced new fallout from the Northern Rock episode today as opposition MPs demanded urgent action to prevent a repeat of the run on the embattled lender.

MINISTERS faced new fallout from the Northern Rock episode today as opposition MPs demanded urgent action to prevent a repeat of the run on the embattled lender.

Bank of England Governor Mervyn King’s call for a legislative overhaul of banking regulations was echoed by shadow chancellor George Osborne.

In a letter to Chancellor Alistair Darling, Mr Osborne said reform was an ‘‘urgent priority’’ and pressed for talks and early legislation when Parliament returns next month.

Liberal Democrat Treasury spokesman Vince Cable laid the blame for the crisis squarely at the door of Number 10, saying Mr King had inherited a flawed system of bank supervision.

Mr King urged politicians of all parties to work together on a ‘‘serious reform’’ of the existing system.

Northern Rock shares slid a further 28%yesterday as rumours of a cut-price takeover continued to circulate for the Newcastle-based company.

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