Adam Applegarth, Northern Rock’s chief executive, was always something of a maverick in the world of banking, but his distinctive style reflects that of the region’s business leaders.

The businessmen say that it is no fluke that the North East has produced and attracted leaders such as Mr Applegarth, Mike Ashley, the controversial owner of Newcastle United, and Karl Watkin, the serial entrepreneur who provoked outrage by selling his shares and netting himself £3.5 million from a dot-com start-up shortly before its collapse.

A generation of risk-loving, chippy and pugnacious businessmen who refuse to blend in with the “grey men” of the City is a product of a region that has proved a tough neighbourhood for businesses.

Mr Watkin said: “There’s no question being from the North East shaped my life. My father was a miner and my mother’s family all worked in the shipyards. That’s changed radically in the past 25 years. There’s virtually no jobs in the shipyards, none in steel and none in the pits. That was a hard time and it made me who I am.”

He was working as a nightclub bouncer when he resolved to become a businessman. He has earned a reputation as a tough entrepreneur who has floated half a dozen companies on the Alternative Investment Market. He has been consistently ahead of the game in spotting emerging trends, helped in part by two years spent in China in the early 1980s.

“Where we have had successful indigenous companies, like Sage, Northern Rock and Northumbria Water before it was bought out, they have done amazing things for the region. It’s a tragedy there aren’t more. To be frank, it’s because the North East has a chip on its shoulder.”

Elizabeth Smith, the CBI’s assistant regional director in the North East, attributes the gritty business culture to the high concentration of public sector jobs in the region. At 34 per cent of the working population, it is twice the national average.

“The large public sector has meant that business leaders have to work harder to get their voices heard.” The regional Chamber of Commerce says that surveys show most school-children believe that they have to leave the area in order to succeed, a fact reflected in the North East’s declining population – although Newcastle celebrated recently when, for the first time in years, its population increased.

Andy Pike, an expert in regional policy at Newcastle University, said that many of the region’s problems were hangovers of its industrial history: “There are deep pockets of worklessness within the region. In most cases it’s in former coal areas and in single-industry towns. The intractable problem for the region is how hard it is to connect those pockets to the economic growth in the region. There’s quite an ageing workforce with particular skill sets that were quite abruptly ejected from the workforce in the 1980s, coinciding with the liberalisation of the UK economy. Some of them have had life-limiting illnesses.”

The region’s manufacturing base has fallen to 17 per cent of the workforce. There is rising productivity in the manufacturing sector – the Nissan plant in Sunderland has the highest productivity of any car factory in Western Europe – but this has failed to mask an increasing reliance on poorly paid, lower-skilled jobs in the service sector, based in call centres and in the retail sector. Gross value added per worker is about 20 per cent lower than the national average.

No-nonsense approach to business

Karl Watkin

The outspoken entrepreneur’s motto is said to be “shy boys get nowt”, and he is never shy of displaying his Newcastle roots. Mr Watkin, who founded the dot-com bubble victim just2clicks, making £3.5 million from a £30,000 investment, put his head above the parapet last year to organise a march in support of the NatWest Three. The Newcastle United fan has set up and floated six companies on the Alternative Investment Market. He recently announced that he was extending his Plane Chartering business into Tyneside, explaining that it would give his business partner Alex Worrall more opportunity “to go and watch Middlesbrough lose”.

Bryan Sanderson

A giant of the North East’s business world and a former chairman of Sunderland football club, Mr Sanderson, 67, spent most of his career at BP before joining Standard Chartered, the international bank that he chaired. He advised Tony Blair on competitiveness and has good connections with the Government through his involvement in quangos. That should come in useful as he tries to steer Northern Rock through perilous waters while keeping the Bank of England and the Treasury happy. He has a reputation as a decisive figure but is also an amiable smooth-talker with good international connections from his time at BP. He is a graduate of the London School of Economics and the IMEDE Business School in Lausanne.

Sir Ian Gibson CBE

Another key figure of the Northern Rock rescue squad as its senior nonexecutive director. Despite being born in Manchester, Sir Ian, 60, has earned a place as an honorary North Easterner by virtue of long stint with Nissan, which has its flagship European plant in Sunderland. He forged his reputation in the crucible of the 1980s motor industry. After 16 years with Ford, he joined Nissan as director of production and control in 1984, before becoming managing director in 1989 and eventually European president. He acquired a reputation as a tough negotiator among the unions. His directorship with Greggs, the Newcastle-based bakery chain, and Northern Rock make him one of the biggest beasts in the region’s business jungle. But it’s been a tough year. As chairman of Trinity Mirror he has presided over a botched asset sale, while his upcoming chairmanship of Wm Morrison, the supermarket group, is likely to be a stern test.

Mike Ashley

The controversial Sports Direct and Newcastle United owner is the bête noire of the investment community because of his disregard for the norms of public company governance and his company’s miserable share performance. Not that the fuss seems to bother him. Camera shy, at least until taking £900 million from the February float, he now proudly boasts he has “balls of steel”. The billionaire has taken to wearing a Newcastle United shirt to matches at St James’ Park and buying drinks after games for the Toon Army faithful. Mr Ashley, 42, will presumably find their devotion an antidote to the City investors he branded “moaning cry babies” who are “on the phone every five minutes just because there’s a share-price movement up or down”.

Numbers game

Unemployment rate July 2007, 6.9% – highest in the UK

Economic inactivity rate July 2007, 24% – highest in England, below Northern Ireland and Wales

House price inflation 7.1%

Average house price £130,791

Public spending as share of GDP, 63%

Source: Office for National Statistics, Land Registry, cebr

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