One that will be discontinued is Money and Jobs, which provided funds for Street North East, a not-for-profit organisation providing micro-loans for small businesses.
"The effect is going to be huge," said Street North East chief executive John Hall. "You can't take out 20 to 30 million pounds a year to organisations such as ourselves without there being an effect."
In 2005, Newcastle was among a group of cities held up by Britain's government and former Prime Minister Tony Blair - who is from nearby County Durham - as evidence of how new industries were prospering, and the rich southeast was not the only place driving Britain's growth.
Manchester, Leeds, Liverpool and Newcastle were all making strides by following a blueprint for urban regeneration drawn up by Bilbao, the industrial port in Spain's Basque country that created a tourism and economic boom in the last decade.
The reality was already tougher than the rhetoric. Although the region's economy was the third fastest-growing in Britain at 5.5 percent in 2006, the northeast ranked behind only Wales as the lowest contributor per person to Britain's economy, according to government figures.
Although unemployment in the region has fallen, it is still relatively high: between April 2006 and March 2007, the northeast was the region with the second-highest unemployment rate in the country, at 6.6 percent.
EMBLEM OF ACHIEVEMENT
This helped Northern Rock, or "the Rock" as local people call it, achieve wide popularity as an emblem of achievement: the bank became a focal point for business pride among Geordies, as people from Tyneside call themselves.
"It's bandied around quite a lot as Geordie pride but Northern Rock is synonymous with success in the region," Hall said.
The bank established itself as Britain's most aggressive home lender, reshaping the mortgage market. By blazing a new trail in financial services 280 miles from, London, it epitomised the breakthrough of a city whose 19th-century power in coal and shipbuilding had long waned.
Hedge fund RAB Capital, the bank's second biggest shareholder, estimated Northern Rock saved mortgage borrowers in Britain about 5 billion pounds a year by driving down charges across the industry with its innovative way of packaging mortgages and reselling them to institutional investors. The bank prided itself as the lowest-cost lender in Europe.
Northern Rock's crisis - perhaps predictably - has also rekindled old resentments fuelled by the sharp economic divide between the north and Britain's prosperous south.
Jon Wood, head of the bank's biggest shareholder, hedge fund SRM, said the London-based central bank had "named and shamed" Northern Rock while banks in other countries had been able to privately access emergency funds.
"It's a reflection of things gone past, things haven't changed," said Ray Spencer, director of Customs House, a theatre and cinema in South Shields which has received about 400,000 pounds in grants from the bank's foundation.
"We don't always get the support from the southeast."
