Northern Rock customers rush to sell shares

New shareholders in Northern Rock were engaged in a rush to offload their shares yesterday, despite predictions that takeover bids could sharply increase the value of their windfalls. Lloyds Bank Stockbrokers said nearly a third of its 5,000 calls yesterday morning were requests to sell Northern Rock shares, which finished the day up 11p at 463p.

The rush has been prompted by unexpectedly high prices in an initial auction on Tuesday, when more than 350,000 members sold 190 million shares, yielding windfalls of pounds 2,260 each. Some analysts are predicting that small shareholders may miss out as institutions, convinced that takeovers will push up share prices, snap up the windfalls. But NatWest stockbrokers is urging investors to sell, claiming Northern Rock is vulnerable to interest rate rises.