Shares in stricken bank Northern Rock were suspended today after the Government moved yesterday to nationalise the lender.

Trading in the bank's shares - which closed at 90p on Friday - was halted on the London Stock Exchange, leaving shareholders anxious over the amount, if any, of compensation they would receive.

The Government said yesterday that it would appoint an independent valuer to decide the level of compensation. What now for stricken mortgage lender?

The Treasury has announced the nationalisation of Northern Rock, following failed attempts by Virgin and an in-house team to agree a private sector solution.

WHAT IS NATIONALISATION?

Nationalisation means the Government taking a business from its current shareholders into public ownership.

The vast majority of businesses have moved the other way from public to private hands under recent governments.

WHAT HAPPENS NOW?

Emergency legislation will be rushed through Parliament. A Government-appointed arbitration panel will decide on a fair level of compensation for Northern Rock's shareholders when the move is made.

SURELY CIVIL SERVANTS DON'T KNOW HOW TO RUN A BANK?

The Treasury won't be bussing coach-loads of officials up to Northern Rock's headquarters in Newcastle to take over the running of the mortgage lender. The business would be publicly-owned but run at arm's length by a new management team. Former Lloyd's of London chief executive Ron Sandler will take over as executive chairman.

I'M A SAVER. WILL ANYTHING HAPPEN TO MY MONEY?

The Government has already stepped in to guarantee savers' deposits - it was forced to make the move to stop the run on the lender.

WOULD I BE ABLE TO GET MY MONEY STRAIGHTAWAY?

Yes. The day-to-day running of the business would continue as normal.

WHAT HAPPENS IF I HAVE A MORTGAGE WITH NORTHERN ROCK?

You would continue to pay the mortgage in the normal way, although if you fell behind on your payments and were repossessed, your house would now be ultimately owned by the Government.

Chancellor Alistair Darling defended the decision to nationalise Northern Rock, saying the move offered the best value for taxpayers' money.

But he said the measure was only for the short term, and the future of the bank lay in the private sector.

Emergency legislation will be put before Parliament today to bring the ailing bank under "temporary public ownership" after the Government decided that proposals for a takeover of the bank would not deliver "sufficient value for money" for the taxpayer.

Ron Sandler - the man charged with running the nationalised bank - will visit Newcastle in a bid to reassure staff and Northern Rock representatives.

Political opponents said the move to public ownership for the Rock marked the death of the Government's reputation for economic competence.

But Mr Darling insisted it was the best way to safeguard people's money.

"We had independent advisers look at this, and they all pointed in one direction: the best thing to do was to take the bank into a period of temporary public ownership before ultimately trying to return it to the private sector," he said.

The Chancellor said the Government had looked carefully at proposals for a takeover received as late as Friday, but decided they did not offer sufficient value for money.

"Once the bank has been taken over, if people have got proposals, we will listen to them, but they have got to pass a simple test - what is the best value for the British taxpayer?" he said.

David Greene, of the law firm Edwin Coe, representing 6000 Northern Rock shareholders, warned that legal action now appeared inevitable.

"It looks as though legal action will follow. The shareholders are clearly angered by this, having been treated with utter, utter disdain throughout this process," he said.

"We will have to look at the proposals for how much they pay for the business and for the assets."