But it admitted flotation speeded up the closure process

But it admitted flotation speeded up the closure process.Mr Bennett said: “I don’t think we’d have done it at the pace we did. But we would have done it.” He added the bank did not anticipate further branch closures “for the time being”.In common with many banks, Northern Rock is trying to save costs by reducing the number of transactions carried out in branches. We’ve have had no official or unofficial approaches.”Analysts said yesterday that, even at current prices, Northern Rock still remained a likely takeover target One said: “It’s a good little business. It would fit well with a larger UK or European bank which wants to strengthen its position in the UK mortgage sector.”Northern Rock yesterday unveiled its first set of figures since flotation on 1 October Profits rose by almost a fifth to pounds 200m.

Leo Finn, chief executive, said: “The process of conversion … did not deter us from achieving our challenging business targets.”The former building society also announced yesterday that, by the end of this quarter, it will have closed 25 branches since the beginning of September, mostly in the North of England. Most recently, the company has been linked with Lloyds TSB, a rumour denied by Mr Bennett yesterday.He said: “We have no wish to be taken over – we think we’re a good operation with a good management…. “Why the hell would we want to sell up?” asked Bob Bennett, Northern Rock’s finance director. According to Mr Bennett, no one can run Northern Rock better than Northern Rock itself, a fact that, in his view, serves to deter would-be buyers.
But Mr Bennett admitted the bank would consider offers that valued the company at a significant premium to its current share price. These are the pounds 52m bid by Johnson Press for the Home Counties newspaper group, and the potential sale by United Newspapers of United Provincial Newspapers.. Northern Rock yesterday poured cold water on the persistent takeover rumours which have buoyed up its share price since flotation last October.

“I just can’t see that people would be willing to pay that premium,” he said.Takeover rumours have swirled around Northern Rock since flotation last October, helping its share price to surge by almost a third. But, as Lea Paterson reports, a takeover of the former building society is not completely out of the question, as long as the price is right. Deutsche Bank yesterday confirmed the name Morgan Grenfell, one of the oldest in the City of London, would no longer be linked with investment banking. But, as Lea Paterson reports, the Morgan Grenfell name will not disappear altogether as the German parent is to retain the brand name of Morgan Grenfell Asset Management. This argument boils down to a natural suspicion of jam tomorrow in return for cash upfront in the business community.However, the CBI is on stronger ground in saying the Government has opted for too low a cut-off in its definition of “small” businesses. The German bank announced it would make a 2.5bn German mark (pounds 842m) provision to cover restructuring costs. So are taxes that fall directly on individuals, through higher excise duties, “green” taxes and reduced reliefs for mortgages and profit-related pay.

The tax burden faced by British business remains among the lowest in the developed world. If the industrialists approve of Gordon Brown’s tough fiscal policies – which they do – they must in their hearts accept that business has to shoulder at least some of the burden of setting the public finances in order again.. There are 353,000 companies with turnover below the pounds 300,000 cut-off. There are only another 16,000 with turnover between that and pounds 1.5m, but many of these are growing fast and rapidly progress into the ranks of “big” companies. It would cost little in foregone tax revenue and save on administration to exempt these two from the quarterly system. After all, just 39,000 businesses pay 85 per cent of all corporation tax.On the CBI’s broader point, it is true that taxes on business are climbing. And it wants more smallish businesses to be cushioned from the burden by not having to switch to quarterly tax payments, not just those with sales of pounds 300,000 or less as the Treasury proposes.
The point about reduced cash flow, which could hit investment spending for four years, is correct but overlooks the fact that lower corporation tax rates will over time compensate for it.

Although complaining about higher taxes amounting to pounds 22bn during the lifetime of this Parliament – mainly due to the abolition of the dividend tax credit, the CBI’s main gripe was about the abolition of ACT and switch to quarterly payments for mainstream corporation tax It doesn’t like the blow to corporate cash flow. Some commentators have billed it as the end of the love-fest between New Labour and business but, in fact, the CBI would have been failing in its duties if it had not pleaded its special interests. If you invest in a company where the controlling shareholder suddenly decides to play hardball, you can’t count on the old British sense of decency and fair play to protect you.. The ritual of Budget submissions is well under way again with yesterday’s predictable appeal to the Chancellor from the CBI to treat business more kindly. The brutal but simple fact is that, having taken control of Astec through an asset swap back in 1989, Emerson can pretty much do whatever it likes.If Emerson is obeying the letter of the law, however, it is hardly observing the spirit. For eight years, the relationship between Emerson, Astec and its remaining shareholders was a happy one.