LONDON (Reuters) - The government could provide emergency loans in secret to ailing banks under a proposed law that would give the authorities more power to intervene to prevent another Northern Rock-style crisis.
The government on Wednesday launched a 12-week consultation on improving the framework to preserve financial stability and protect depositors should a bank fail.
The proposals include allowing a bank to keep emergency loans secret for a short period, in contrast to Northern Rock (NRK.L: Quote, Profile, Research), whose announcement that it had needed emergency funding prompted the first run on the deposits of a UK bank for over 140 years as savers panicked.