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The coalition government has agreed to sell Northern Rock to online lender Virgin Money for #747 million ($1.18 billion, 872 million euros) in cash, although the final amount could rise to about #1.0 billion, the Treasury said.
The British taxpayer has injected #1.4 billion of public funds into the bank, whose nationalisation three years ago sent shockwaves through the global financial markets.
"The government is selling Northern Rock plc to Virgin Money. It represents a significant step in returning public sector stakes in banks to the private sector," the Treasury said in a statement.