The British Government is pumping a further £3 billion into Northern Rock which it nationalised earlier this year to save from collapse.
Northern Rock fell victim to a run on its funds and has announced a bigger than expected half year loss of £585 million.
Unlike earlier loans to Northern Rock, the £3b will be turned into equity.
The extra Government funding has been criticised by the opposition. Both the Conservatives and Liberal Democrats said the government were putting taxpayers at unacceptable risk.
The government nationalised the lender in February after the first run on a bank in Britain in more than a century.
Since then, Northern Rock's financial position has deterioriated further.
The bank was once Britain's fifth-biggest home loan provider.
It has reduced the number of mortgage accounts by 15%, to 662,000 at the end of June compared to 777,000 at the end of 2007. In cash terms, loans and advances to customers were cut by £14.5b in the first half of the year to £84.4b.