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The financial crisis has struck at the heart of Gordon Brown's constituency with the Dunfermline Building Society allegedly needing a £60m taxpayer bailout.
The mutual, Scotland's biggest society, would be the first in the sector to require public rescue in what would be another blow to local financial prestige following problems at the Royal Bank of Scotland and HBOS. The Dunfermline, which has 250,000 savers and 35,000 borrowers, would not comment on weekend media reports that it had gone cap in hand to ministers after running into trouble.
Major losses are believed to have been run up on the commercial property and residential loan side of the society, which is based in the heartland of the prime minister's Dunfermline East constituency.
The society's 2008 accounts, which were due to be announced in the next few weeks, have been delayed after auditor Deloitte & Touche would not sign them off, the Mail on Sunday said, adding that administrators have been approached about running the mutual.
"You may have seen the press articles this morning in relation to the society," said Jim Willens, chief executive. "The articles are speculative. Our results are due out in the next two weeks, and we will not comment on them until that time."
The Financial Services Authority has apparently been unable to find buyers for the Dunfermline after approaches to rivals such as Britannia and Nationwide.
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