By Marcus Leach

Following the announcement by Chancellor George Osbourne that Northern Rock is to be privatised it has been confirmed that he will try and sell the bank to a single buyer.

Other options have not been ignored, but advice has been given suggesting the sale to a single buyer will make the most money.

The government injected £1.4 billion into the bank, with the auction expected to raise in the region of £1 billion. However, not all of the bank will be sold.

Northern Rock has been divided into two, the 'good bank' which contains customers' savings and roughly seventy branches, and the 'bad bank' consisting of the more toxic loans.

The 'good bank' is to be sold, with the 'bad bank' to remain with the Treasury. Shadow Chancellor Ed Balls has called for Northern Rock to be mutualised, rather than being sold, criticising Mr Osbourne for not giving serious consideration to all options.

He has also criticised the chancellor for not announcing the sale in the House of Commons first.

"The independent advice I have received is that a sale process is likely to generate substantially the best value for the taxpayer and should be explored as a first option," Mr Osbourne said.

The sale to a single buyer does not guarantee that Northern Rock will not be mutualised anyway, as the Treasury is expecting to receive bids from both the Yorkshire Building Society and from Coventry Building Society.

Other possibilities of buyers include Virgin Money, Sir Richard Branson's bank, as well as NBNK, although it seems both of these are more interested in Verde, the banking business Lloyds are selling.