Britain's Treasury today announced that the beleaguered bank Northern Rock will be nationalised until financial markets stabilise and it can be returned to the private sector.
Chancellor Alistair Darling said "under the current market conditions" neither of the two private proposals to buy out the bank delivered "sufficient value for money" to the taxpayer.
"The government has decided to bring forward legislation to bring Northern Rock into a temporary period of public ownership," Mr Darling told a news conference.
The first run on a major British bank in more than a century last year has become a headache for Prime Minister Gordon Brown, tarnishing his popularity and denting a reputation for financial stability.
Britain's fifth-largest mortgage lender already owes taxpayers £25 billion (€33.4 billion) and has been put on the government's books as around £90 billion (€120 billion) of public debt.
A consortium led by billionaire Richard Branson's Virgin Group had been the front-runner, ahead of an offer led by the bank's management team. Both were told last week to improve their offers because neither offered taxpayers a good enough deal.