He said the continuation of this agreement would be a condition of any sale if the bank were to be sold within the three-year period. He added that the bank’s new board would be asked to “identify a viable long-term future” for the foundation.
“We are very pleased that provision has been made for the foundation,” said Rob Williamson, director of policy and communications at the foundation. “However, we don’t know the precise details yet and the trustees haven’t had the chance to discuss how this will affect us at the moment.”
Williamson added that, in the meantime, the foundation would continue with its existing £7m funding plans for 2008. “Until we have more details about what this means in terms of when we will receive these income streams, it will be difficult to make more long-term plans,” he said.
David Carrington, an independent sector consultant, said: “It was predicted that under nationalisation the north east would lose its major charitable institution, but it looks like the Government has ensured its survival, which must be welcome in the region and among trusts and foundations.”
Virgin Money, which until yesterday had been expected to buy out the troubled lender, had said it would provide up to £10m of funding in each year that Northern Rock’s profits exceeded £638m up to 2015.