London: Northern Rock, Britain’s first major victim of the global credit crisis, started the new year on Monday under a new structure intended to prepare the mortgage lender to return to the private sector.

Northern Rock PLC said it was business as usual for its customers and that they did not have to take any action because of the new structure.

Under the overhaul effective on 1 January, the company’s riskiest assets have been vested in a new company known as Northern Rock (Asset Management) PLC. That company will not be accepting deposits or making new loans, but will free up the rest of Northern Rock to do business.

Northern Rock, once the country’s fifth biggest lender, suffered the first run on a British bank since 1866 after the Bank of England announced in September 2007 that it had provided emergency funding.

The government pumped £27 billion in loans and assumed contingent liabilities of £29 billion in an effort to keep Northern Rock afloat, before resorting to nationalization on 22 Febuary, 2008.

The government gauranteed 100% of customers’ deposits in Northern Rock, and that guarantee remains in place.

The new entity holds £10 billion ($16 billion) in mortgages, £5 billion cash, £5 billion of the government loan to Northern Rock and £19 billion in retail deposits.

The rest of the old Northern Rock was placed in a company known as AssetCo, which holds £80 billion of Northern Rock assets, the rest of the residential mortgage book, the bulk of the existing government loan to Northern Rock plus the bank’s wholesale funding instruments. It will not accept deposits.

As of October, Northern Rock accounted for 5.5% of the mortgage market, compared to 7.5% at the end of 2007; and it held 1.5% of UK savings deposits.

Since Northern Rock was taken over, the government also took control of mortgage lender Bradford & Bingley, an 84% stake in Royal Bank of Scotland and a 43% stake in Lloyds Banking Group.