The crisis caused by the collapse of the U.S. subprime market has claimed another overseas victim, as Northern Rock, Britain's fifth-largest mortgage lender, was forced to seek a lifeline

The British government said today that it had authorized the Bank of England to make an unspecified amount of emergency loans available to Newcastle-based Northern Rock. Treasury officials stressed that the lender was solvent and that the help was short term, but the BBC reported that there were long lines of customers outside several Northern Rock branches around the country.

The troubles at Northern Rock illustrate the deep and global impact of the crisis of confidence that has seized up credit markets. It is a crisis that was triggered by the implosion in the United States subprime mortgage market, and yet Northern Rock has no direct subprime exposure.

But the lender, which lacks a deposit base like most banks, needs to raise the money it provides for mortgages by borrowing from banks and other financial institutions.

As the chancellor of the Exchequer, Alistair Darling, told the BBC, "The problem here is there is a lot of money in the system but they are reluctant to lend it to each other at the moment."

Northern Rock said in a statement, "It has now become clear that the global credit and liquidity markets have not recovered in the early part of September, and that there continues to be a severe liquidity squeeze."

Worries about a squeeze roiled European markets today. Shares of Northern Rock plunged nearly 25 percent.

Northern Rock declined to comment on the terms of the emergency loans in a conference call today, but said that "clearly a substantial amount is required" and that it would be charged a penalty interest rate, according to Reuters.

Unlike the Federal Reserve and the European Central Bank, the Bank of England had not previously taken steps to increased liquidity in money markets, saying it would only be a lender of last resort.

 "Nobody could claim they saw it coming," Northern Rock's chief executive, Adam Applegarth, said on the call, according to the Financial Times' Alphaville blog.

"The world changed on August 9,"  Applegarth said. "This problem isn't Northern Rock specific. It must be difficult for other banks too."