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The bill charged to Northern Rock by the Treasury, Bank of England and the FSA for professional fees ran to £12.5m in the second half of 2007, according to former bank’s annual report, published on Monday. Professional fees run up by Rock for its own advice and the like were £21.2m.

Neither number seems that shocking in the circumstances.

Other nuggets:

The 2007 charge for customer loan loss impairment amounted to £239.7 million (2006 — £81.2 million) representing 0.26% of mean advances to customers (2006 — 0.10%). The increases in the loan loss impairment charge and year end impairment provision balances reflect the increase in default rates highlighted by higher arrears and properties in possession but also a significant deterioration in forecast recoveries on impaired loans. The reduction in house prices reported for the last quarter of 2007, together with further anticipated falls as evidenced by trends in losses in the first quarter of 2008 have resulted in an increase in expected losses to be incurred on impaired mortgage loans. Anticipated recoveries on impaired unsecured loans have also fallen dramatically as customers’ equity in their residential properties is expected to continue to fall and the market for debt sales since the year end has substantially disappeared.

- Statutory loss of £168m, against a profit of £627m in 2006, after a £410m impairment charge on treasury assets and non-recurring expenses of £127m, etc. Underlying profit put at £422m, down from £587m.

- Tier 1 capital falls from £2bn to £1.6bn.

Outlook statement:

In accordance with European legislation, the Government is required to seek approval for the granting of the facilities to Northern Rock under State aid law, and the continuation of these facilities is dependent upon approval by the European Commission. A submission to the European Commission was made by the Government on 17 March 2008 and at the date of the approval of the Report and Accounts remained under review.

Going forward the Company’s business plan will be aligned with the objectives of the Tripartite Authorities at the time of taking Northern Rock into temporary public ownership. Together with compliance with European State aid law this will necessitate a significant contraction in the Group’s balance sheet driven by increased loan redemptions. At the same time, new business levels will be significantly lower than in previous years. New business will be focussed on prime residential mortgages with absolute levels dependent on new funding generated mainly from retail deposits in the UK. Longer term, it is intended that Northern Rock will return to the private sector as a lower risk, financially viable mortgage and savings bank.

Northern Rock’s annual report