By Sumeet Desai and David Clarke

LONDON (Reuters) - British Prime Minister Gordon Brown faces a grilling on Monday after the government said it would take ailing bank Northern Rock into public ownership, the first nationalisation since the 1970s.

Brown will hold a news conference at 1100 GMT and finance minister Alistair Darling will announce new legislation allowing the government to take over Britain's fifth-largest mortgage lender after rejecting two private sector bids on Sunday.

Northern Rock has borrowed about 25 billion pounds from the Bank of England since the global credit crisis last year wrecked its funding model, sparking the first run on deposits at a British bank for some 140 years.

With a national election due by May 2010 at the latest, the debacle is a lingering headache for Brown and Darling and has tarnished both the Labour government's popularity and the prime minister's reputation as a guardian of financial stability.

The mortgage lender has been put on the government's books, classified as around 90 billion pounds of public debt, and the focus will now shift to how soon a buyer can be found.

Opposition politicians ultimately blame Brown for the crisis, pointing to the regulatory framework he put in place a decade ago when he was finance minister under Tony Blair.

While the government has criticised Northern Rock's business model, Brown blames the bank's woes on a credit crisis that started with risky mortgage lending in the United States and has since spread throughout the world's banking system.

He argues the British economy is better placed than many to withstand the fallout from global financial market turmoil and the government stressed on Sunday that nationalisation was only temporary and in the best interest of taxpayers.