GOLDEN GOODBYE': Adam Applegarth

SHAREHOLDERS voiced their fury last night that the architect of Northern Rock's £25bn demise will receive a £760,000 "golden gooodbye".

The payout to former chief executive Adam Applegarth is on top of his £2.5m pension and more than £2.6m earned from selling Northern Rock shares in the 18 months before the bank's financial meltdown.

The full scale of his settlement will be revealed in the bank's 2007 accounts, to be published today - months later than planned.

Last night, Robin Ashby, of the Northern Rock Small Shareholders' Association, said Mr Applegarth's record should mean he receives nothing. He said: "We're talking about a man whose business model ruined Northern Rock, left 18,000 shareholders with nothing and meant thousands of people lost their jobs. I cannot see how he should be entitled to anything.

North Durham MP Kevan Jones said: "I think many who are now facing possible job losses will be very angry and incredulous that a man who has already made millions out of their misery is going to be paid that amount of money."

Roger Lawson, of the UK Shareholders' Association, said: "A lot of shareholders will be unhappy he is getting anything."

Northern Rock came close to collapse in September as thousands of customers queued to withdraw their money in the first run on a British bank for more than a century.

The Newcastle-based bank was nationalised last month, after being kept afloat with emergency funding from the Bank of England. It owes the taxpayer £26bn.

About 2,000 of the bank's 6,500 workforce - 5,000 of whom are in the North-East - are expected to lose their jobs by 2011.

Mr Applegarth, 46, resigned as chief executive in December. He was paid £1.36m in 2006, including bonuses of £600,000.

Northern Rock declined to comment ahead of today's announcement, but it has previously said Mr Applegarth would receive a settlement worth "substantially less" than if his contract was being ended under normal circumstances.

Vince Cable, the Liberal Democrats' Treasury spokesman, said it was "outrageous that someone who brought the bank to the brink of destruction and subjected taxpayers to liabilities worth billions of pounds should be rewarded for failure".

Northern Rock's accounts are also expected to reveal it paid investment banks such as Citigroup and Goldman Sachs millions from public funds for advice on a possible sale of the business.

The bank was nationalised after Sir Richard Branson's Virgin Group failed to agree takeover terms with Chancellor Alastair Darling.

Reports suggest Northern Rock will be shown to have fallen into the red, on the back of huge interest payments to the Bank of England.

Ron Sandler, the bank's new executive chairman, is thought to want to write off as much debt as possible with his first set of results.

It is thought Northern Rock's mortgage book has reduced substantially, with many customers being sent letters advising them to switch to other lenders when their present deal runs out, because the nationalised bank will not be willing to offer them a new one.

However, Mr Ashby said claims that Northern Rock was losing money would be "entirely a paper exercise", not reflecting the underlying value of the business. Mr Jones said: "The key thing is trying to retain the business and retain as many jobs as possible in this region, but payouts like this leave a bad taste in a lot of people's mouths."

6:02am Monday 31st March 2008

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