Arcane Market Is Next to Face Big Credit Test

But some experts now predict that an announcement confirming the banks' nationalisation could be made within days.

The recruitment of Mr Sandler, who was approached by the Treasury in November, indicates contingency plans for Northern Rock are well advanced.

He said that his role would be to get things stabilised, to make sure the bank has proper plans in place.

The troubleshooter added that he would also be responsible for ensuring that a management team was in place at the bank.

If Mr Sandler is appointed, it will not be the first time he has been parachuted into a difficult business situation.

As chief executive of Lloyd's of London, he received credit for bringing the insurance market back from the brink of collapse. read more