Gordon Brown told the public it was viable for Northern Rock to be sold at a future profit - days after his own financial advisers had effectively ruled this out.

Mr Brown insisted at his monthly press conference on February 18, soon after the nationalisation of the troubled lender, that a profit could be made from the business when financial markets recovered.

But it emerged yesterday that Goldman Sachs, which was advising the Treasury on its options for Northern Rock, had already told ministers that a loss of £450m was the best-case scenario and that a loss of £1.28bn was the most realistic "base case scenario", according to documents published by the Sunday Times.

The US investment bank also warned that the figure could be much higher if there was a significant drop in house prices, which now looks increasingly likely.

The Goldman documents were revealed by John Kingman, the Treasury official in charge of Northern Rock, in evidence submitted to a judicial review into the decision to nationalise the lender.

The Treasury said yesterday its purpose had always been to maintain the stability of the financial sector and "making the biggest profit" was not its intention.

However, the revelation does raise questions over Mr Brown's assertion in front of the world's press on February 18.

Vince Cable, Treasury spokesman for the Liberal Democrats, said it was "at best staggeringly naive" to have suggested that taxpayers could have profited from the eventual sale.