Shares in Northern Rock took a fresh hit on Thursday, tumbling over 20 percent on renewed concerns over its future, and as the government said its guarantees would not cover new accounts.

Analysts revived talk that the country's fifth-largest mortgage lender, seen as a likely takeover target since being engulfed by a funding and customer confidence crisis on Friday, may struggle to attract a suitor.

Analysts at bank ABN AMRO, which had called Northern Rock a trading buy earlier this week as regulators encouraged buyers to come forward, closed its position on Thursday.

Recent commentary from the rest of the UK banks suggests they are reluctant to participate, which does not support near-term share price performance, the bank said in a note.

Late on Wednesday, Standard & Poor's downgraded the bank's rating to A- from A, with a negative outlook.

Since it will be extremely difficult for Northern Rock to rebuild its franchise, we expect that it will effectively begin to wind down in an orderly manner if it is not acquired in the near future, Standard & Poor's analyst Richard Barnes said.

The agency said there was still a reasonable probability of a takeover but that a deal was by no means certain.

At 8.40 a.m., shares in Northern Rock, trading at virtually a third of their value a week ago, were down 15.3 percent at 217.75 pence. Mortgage lenders Alliance & Leicester and Bradford & Bingley were also dragged lower, trading down 3.1 percent and 3.96 percent, respectively.

Earlier on Thursday, the Treasury said in a statement that its proposed safety net would not cover new accounts.

It confirmed the guarantee would cover all Northern Rock accounts existing at midnight on Wednesday, September 19 and reopened accounts, as well as existing and renewed wholesale deposits, and existing and renewed wholesale borrowing that is not collateralized.

The guarantee will not cover other debt instruments including covered bonds, securities issued under the Granite program, and subordinated and other hybrid capital instruments.

Northern Rock has been struggling with rising borrowing costs since the credit crunch dried up its main source of funding -- the wholesale markets. It sparked a run on deposits last week, however, when the Bank of England was forced to step in with an emergency funding facility.

United kingdom