Brown, who helped transform the Labour Party in the 1990s by ditching an attachment to state ownership, has been accused of dithering in a five-month crisis in which the government lent around 25 billion pounds to keep Northern Rock afloat, while it cast around for private bidders.
"We did the right thing, at the right time for the right reasons," Brown told a news conference. "We have contained the problems. It has not spread across to the rest of the economy."
Chancellor Alistair Darling announced on Monday draft legislation in parliament allowing the government, which rejected two private sector-led bids this weekend, to take over Britain's fifth-largest mortgage bank.
"It was right to look at all the options available to us," Brown told the news conference, dismissing questions over why he took months to come to a decision. "We have lost nothing in doing so."
Day-to-day running of Northern Rock passes to Ron Sandler, the troubleshooter who rescued the Lloyd's of London insurance market from the brink of collapse.
Sandler, executive chairman, told reporters the bank had been granted a "period of stability" and a chance to pull back after a torrid few months.
"Public ownership is not about running down this bank," said Sandler. "It is all about stabilisation and building back from a sound, solid platform."
He declined to comment on job losses at the bank or on a business plan, which he will hammer out with UK regulators.
"The bank will have to contract and there will be job losses," said Vincent Cable, economic affairs spokesman for the opposition Liberal Democrats.
The bank is likely to shrink its mortgage book while boosting retail savings, aiming to revive funding while capital markets remain uncertain.
European Union rules could also force the bank to pull back from being one of the sector's most aggressive lenders.
Sandler, speaking at the bank's headquarters in Newcastle, said operations had not degraded during the crisis, but added it would still take "some years" to repay the government's loans.
RISKY TIMES
The government has consistently said the nationalisation - the first major such step in Britain since engine-maker Rolls-Royce was brought under public ownership in 1971 by the then ruling Conservatives - would be only temporary.
But Brown declined to comment on how long public ownership could last: "We can't have a timetable when we're talking about the return of better market conditions as a first step."
Even a temporary state role, however, will carry political and financial risks for a government already tarnished by the debacle, linking its fate to a shrinking mortgage bank at a turbulent time for Britain's housing market.
