Allders has been saved from administration after an 11th hour intervention from Labour business secretary Peter Mandelson.

Almost 1,000 jobs were under threat yesterday as the store struggled to find a new financing deal after becoming caught up in the Icelandic bank collapse last year.

But a deal with new banking partner Natwest was completed in time to avoid administration after Lord Mandelson stepped in, following a request from Selhurst ward councillor Toni Letts.

Allders finance director Max Menon said: “The future is now secure because we don’t have to rely on an Icelandic bank which is being forced by the Icelandic Government to close its books.

“We had to get another provider, without a shadow of a doubt, and Peter Mandelson has helped us.

“But it’s his job to help us - he’s the business secretary - and there’s been a lot of other people helping us as well.”

Croydon Labour leader Tony Newman said he would be recommending Coun Letts for a knighthood following her work in saving the store.

He said: “That’s 1,000 jobs that have been saved, and losing those would have been catastrophic for Croydon.”

Mr Menon said business was improving at the store, which became an independent outlet when the Allders parent company went into administration in 2005.

He said: “Business is looking better now - we were ahead of last year before the snow came and that hit us badly.

“But this store has a great future and we will be profitable for this year.”