Financial Regulation in Crisis?

Financial Regulation in Crisis?

The Role of Law and the Failure of Northern Rock

Elgar Financial Law series

Edited by Joanna Gray and Orkun Akseli

The depositor run on the Northern Rock bank in September 2007, which led to the bank’s subsequent nationalisation was the first run on a UK bank for nearly 150 years and was a seminal moment in the unfolding global financial crisis. This book provides a detailed legal analysis of the role played by financial law and regulation during this event, and the impact the episode made on the law. The contributors to the book explore and elaborate upon the legal technique of securitisation, and how Northern Rock itself created and employed securitised financial assets. There is also in-depth discussion and analysis of the origin of the problems experienced in the wholesale interbank markets surrounding the Northern Rock crisis.


Orkun Akseli, Joanna Gray and Andrew Campbell

Subjects: economics and finance, financial economics and regulation, law - academic, european law, finance and banking law


Orkun Akseli, Joanna Gray and Andrew Campbell The genesis of this collection of essays lay in discussions within Newcastle Law School and more widely within Newcastle University as we witnessed the dramatic events of September 2007 with the run on the Newcastle-based Northern Rock bank. Those discussions broadened in scope as to areas of the law and regulation that they invoked as the twists and turns of the attempted rescue, nationalisation, emergency changes to legal and regulatory provisions to deal with the now-spreading banking crisis ran their course. As the immediate panic of Northern Rock subsided, fresh flurries of panic and instability loomed elsewhere in the financial world from Iceland to the US to the new and emerging financial centres of the Middle and Far East, where theories of decoupling began to look distinctly shaky. Gradually, more considered post mortems took place and longer-term law reform began to be discussed and implemented. But the fact that the ripples or early warning tremors of what we now know to have been a truly global financial crisis of an unprecedented scale were first felt here in the North East of England, a proud and distinctive region but nonetheless hardly a financial powerhouse, as one of the region’s significant employers and oldest and most important large, private sector companies met its nemesis, we thought was worthy of marking by contributing reflections from our different legal backgrounds and scholarly interests. We used the run on Northern Rock and the events preceding and following it...