
Article 1 
The following aid which the United Kingdom has implemented in favour of Northern Rock, BankCo and AssetCo, is compatible with the common market, subject to the conditions set out in Article 2:

((i)) the retroactive application of a lower fee on the Bank of England liquidity facility which later was novated to the UK Treasury (‘the BoE/HMT liquidity facility’) and the reimbursement of the excess fees to Northern Rock after the split-up of Northern Rock into BankCo and AssetCo;
((ii)) the assurance by the UK Treasury to the Financial Services Authority that Northern Rock will operate above regulatory capital requirements;
((iii)) the continuation of the State guarantee on the retail deposits of BankCo;
((iv)) the continuation of the State guarantee on wholesale deposits of BankCo;
((v)) the GBP 1,4 billion recapitalisation of BankCo;
((vi)) the contingent liquidity facility of GBP 1,5 billion for BankCo;
((vii)) the continuation of the State guarantee on wholesale deposits of AssetCo;
((viii)) the increase of the BoE/HMT liquidity facility by up to GBP 10 billion to a maximum of GBP 23 billion;
((ix)) the recapitalisation up to GBP 1,6 billion of AssetCo; and
((x)) the working capital facility of GBP 2,5 billion for AssetCo.
Article 2 
The conditions referred to in Article 1 shall be as follows:

((i)) there must be full operational separation between BankCo and AssetCo as soon as possible and by the end of 2010 at the latest;
((ii)) new lending by BankCo must be capped to GBP 4 billion in 2009, GBP 9 billion in 2010 and GBP 8 billion in 2011; in the event that BankCo remains in Temporary Public Ownership (hereinafter ‘TPO’) after 2011, a lending cap of GBP 8 billion must remain in place until 31 December 2013 or exit from TPO, whichever is earlier;
((iii)) BankCo retail deposit balances across the United Kingdom, Ireland and Guernsey must be capped at GBP 20 billion until 31 December 2011; in the event that BankCo remains in TPO in 2012 and 2013, the retail deposit cap must be GBP 23 billion for 2012 and GBP 26 billion for 2013 or exit from TPO;
((iv)) BankCo, must not rank within the top three Moneyfacts mortgage categories for 2- 3-, or 5-year fixed or variable mortgages (excluding mortgages with a loan-to-value ratio greater than 80 % and products for first time buyers) until 31 December 2011 or exit from TPO, whichever is earlier;
((v)) the UK government must exit majority ownership of BankCo […], in this context, TPO is deemed to be exited if the UK has sold at least 50 % + 1 of BankCo’s shares to a non State-owned or controlled entity (or entities) and the UK has lost control over BankCo within the meaning of Regulation (EC) No 139/2004;
((vi)) BankCo […] must give public notice that the UK retail deposit guarantee will be released by […] and that the wholesale guarantee arrangements related to BankCo will be lifted by the United Kingdom by 31 December 2010;
((vii)) existing subordinated debt must remain in AssetCo and no principal or coupons is to be paid on subordinated debt instruments where AssetCo is contractually able to do so, […];
((viii)) BankCo and AssetCo must not engage in acquisitions of shares in other firms or promote the Government guarantee arrangements or ownership;
((ix)) AssetCo must not undertake any new economic activities apart from the activities necessary to provide operational support to BankCo until the operational separation between BankCo and AssetCo is completed […].
Article 3 
The United Kingdom shall inform the Commission, within two months of notification of this Decision, of the measures taken to comply with it. Furthermore, the United Kingdom shall, from the adoption of this Decision, submit detailed six-monthly reports on the measures taken to comply with it.
Article 4 
This Decision is addressed to the United Kingdom of Great Britain and Northern Ireland.
Done at Brussels, 28 October 2009.
For the Commission
Neelie KROES
Member of the Commission