Brian Walters, Harriman House Publishing, £10.99
Brian Walters, former manager of Northern Rock's commercial finance division, has written a short book detailing his time at the bank during its final years as a private company, observing at (reasonably) close quarters the questionable activities of its directors.
At the top of Northern Rock's pile sat chairman Matt Ridley, aristocrat by birth, zoologist by training, and libertarian by persuasion. Writing in the Daily Telegraph, he once claimed that "governments do not run countries; they parasitise them". Virulently pro-market, Ridley lorded it over a minor former building society from Newcastle that ballooned into the country's fifth biggest mortgage lender, before bursting in spectacular style last September.
An astonished Treasury Select Committee, picking through the wreckage, was later to discover that neither Ridley nor his chief executive, Adam Applegarth, possessed a single banking qualification between them: they had adroitly exploited Britain's financial regulations seemingly without entirely knowing what they were doing.
On Walters' account, Northern Rock seems to have functioned as a bizarre combination of grandstanding local employer made good and Enronesque turbo-bullshit, with Applegarth's annual reports promising ever greater growth at an ever faster rate. But with its own reserves of cash at the barest minimum, the Rock was lending out more than four times what it had in its coffers, a severe imbalance that required the big banks to keep pumping more and more credit into their bloated sibling just to keep it on the road.
When the subprime market in the US collapsed, the big banks panicked. They stopped lending each other cash, not trusting each other's loan books. And they stopped dishing loans out to Northern Rock. Mis-sold mortgages to poor Americans meant that thousands of miles away our plucky libertarian champions had to run squealing to the Bank of England for a handout. News of the bailout leaked, and Northern Rock's understandably rattled depositors caused the first run on a British bank in 140 years.
Northern Rock's board had blundered into a gaping hole in the British system of financial regulation. New Labour had done a dirty little deal with the City: "independence" for the Bank of England, a weak regulator and tax cuts. Let off the leash after 1997, the City whipped itself into a frenzy of speculation - creating more and more credit, some of which was passed on to millions of ordinary bank customers.
It was New Labour's fawning to the City that created the mess. Brian Walters gives you little of this context but perhaps helps fill in some of the details. Alas, pulling his punches does him no favours: though not a natural author, Walters' narrative would have benefited from laying some well placed blows on the greedy and the stupid at the top. Perhaps the next bank to collapse as the credit bubble bursts will produce the vitriolic epitaph it deserves.