The plight of Northern Rock remains a huge embarrassment for both the UK’s policymakers and its financial sector. The authorities confronted a bank run, only to end up guaranteeing the bank’s deposits and funding at least £20bn ($40.9bn) of its liabilities, so far. Many believe government subsidy will be needed if another institution is to be cajoled into taking Northern Rock over. Yet, it still has positive value in the stock market. That is indeed remarkable. So who is to blame for the debacle and what lessons should the UK learn?

Let us call a spade a spade. The blame for the vulnerability of Northern Rock lies with its management, which did not seek to insure their institution against disruption to its funding. The fact that it is the only significant UK bank whose financing imploded during the crisis demonstrates that its problems were specific and home-grown, not generic and so the fault of others.