UK Asset Resolution (UKAR), a holding company established by the British Government to manage the assets of collapsed banks Northern Rock and Bradford & Bingley, has revealed plans to dispose of £5.5bn of housing loans through an auction.
The sale of the assets was started earlier this year; however, its formal launch was announced on 30 November with UKAR’s interim results. It was initially expected to raise enough money to repay the whole of the loan to the FSCS by March 2018.
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The UKAR said the proceeds from the sale of the next portion of Bradford & Bingley’s mortgage portfolio would be used to repay the remaining £4.7bn of a £15.8bn Treasury loan to Britain’s Financial Services Compensation Scheme (FSCS). The transaction is likely to be concluded during the first half of the 2018/19 financial year.
UK Asset Resolution CEO Ian Hares said: “In the first half we finalised a major sale of assets and, subsequently, we have launched the next stage of the asset sales programme designed to repay the remaining FSCS debt.
“These are major steps towards realising our objective of reducing the Balance Sheet while continuing to maximise value for the taxpayer. It is pleasing that we continue to see high levels of service delivered for our customers.”
UKAR has already reduced its balance sheet substantially as the financial holding company sold a portfolio of Bradford & Bingley mortgages for £11.8bn earlier this year. In 2010, its balance sheet stood at £116bn, which had shrunk to £23bn as of July 2017.
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By GlobalData
