Banking crisis – will we get our money back?

Certainly, George Osborne was very happy on Twitter this morning.

"Another important step in clearing up the mess left by the financial crisis," he tweeted at just after 7am.

The government had just announced that £13bn of former Northern Rock mortgages had been sold to the US investment firm Cerberus.

TSB announced shortly afterwards that it had bought £3.4bn of those mortgages from Cerberus.

In total, about 120,000 mortgage holders - who used to be customers of Northern Rock - now find themselves back in private sector hands.

The government has made it clear that the terms and conditions for those mortgages will not change.

Given the roller coaster ride those customers have been on since 2007, that must come as a relief.

As the Treasury slowly unwinds its stake in Northern Rock - held through a wholly owned subsidiary called Northern Rock Asset Resolution - the question "is the taxpayer getting their money back?" becomes more pertinent.

It is worth taking that question in a number of parts.

First, the direct injection of cash at the time of the bank's collapse to buy up the shares totalled £1.4bn, according to Treasury officials.

The "good bit" of Northern Rock - the accounts that were performing well - was later sold to Virgin Money for £1bn.

And the rest of the government's stake in Northern Rock Asset Management is now valued at more than £4bn.

So, on paper at least, the government is ahead.

Northern Rock also received a £29bn loan which is being paid back by what is known as UK Asset Resolution, the government-owned business that is running what remains of the failed assets of Northern Rock and Bradford and Bingley, which also went bust.

Just over £8bn of that loan is still outstanding.

But, the "costs" of the banking collapse go far wider than the direct financial help.

There is the wider economic cost of the recession that followed the banking crisis.

And the government and the Bank of England spent hundreds of billions of pounds providing insurance and cheap funding to the whole banking sector, which allowed the financial system to keep operating.

Northern Rock was one beneficiary of that.

In April, the National Audit Office estimated that the "peak support" received by Northern Rock from the government totalled £60bn.

It said that £25bn of that sum was still outstanding.

Even with today's sale, which brings that figure down substantially, the government still has some way to go to ensuring the taxpayer "gets their money back".

And, of course, that's not including any interest payments normally attached to loans and bailouts.

Sadly, these were not normal times.