Newly-crafted TSB is reportedly considering acquiring £1.5bn worth mortgage portfolio from the UK’s bad bank UK Asset Resolution (UKAR) as part of its strategy to swiftly grow its loan book.
UKAR, a taxpayer-owned intuition that manages the toxic loans of nationalized Northern Rock and Bradford & Bingley, is selling the mortgages to repay £50bn to the UK government, as reported by Sky News.
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TSB, which was recently floated on the London Stock Exchange spinning out of Lloyds Banking Group, has expressed strong interest to buy more mortgages to boost profits.
At present, TSB owns £3.4bn of mortgages on loan from Lloyds and with the help of its widespread 620 branches; the bank aims to boost its mortgage footprint.
UKAR is offloading its £70bn loan book, encompassing approximately 529,000 mortgages and 119,000 unsecured personal loans, and giving its profits back to the UK Treasury, which pumped £48.7bn to save Northern Rock and Bradford & Bingley during the financial crisis of 2008.
A statement by UKAR was cited by Sky News as saying: "The completion of any sale will not affect the terms and conditions of the mortgages sold, and the continued fair treatment of customers will be a key consideration for UKAR in assessing the merits of a sale."
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By GlobalData"The proposed sale is in line with UKAR’s strategy and is part of the orderly wind-down of the closed mortgage books of both B&B and NRAM."
