If it's good enough for us ...

From The Telegraph:

In August, the Government converted £3bn of its loan to Northern Rock into equity to bolster its core tier 1 capital ratio, which had slipped to the dangerously low level of 2.9pc. The Government may have to inject "£2bn pounds to £3bn more," into Northern Rock, a source close to the Government has told The Daily Telegraph.

Fine. In the grander scheme of things, it shouldn't make much difference in the long run whether you invest in a bank as shareholder or bondholder, and the taxpayer is both in this instance. But as I have pointed out before, debt-for-equity-swaps are the only sensible way to sorting out the banking 'crisis'. If the gummint is cheerfully swapping our loan for equity, why isn't it asking all bondholders to do the same?