Bradford & Bingley assets to be sold off
Bradford & Bingley, which is now part of UK Asset Resolution Limited (UKAR) following the bank's collapse at the height of the financial crisis, said that following an open and competitive process, it has agreed to sell two separate portfolios of buy to let and residential owner-occupied mortgages.
Financial completion is expected within the next few weeks and will enable total loan repayments of £5.3bn to HM Treasury, which includes the remaining £4.7bn of the Financial Services Compensation Scheme (FSCS) loan.
Advertisement
Hide AdAdvertisement
Hide AdThis follows the repayment of £10.9bn in 2017 and means that the £15.65bn FSCS loan extended to Bradford & Bingley when it was nationalised in 2008 will have been repaid in full.
UKAR's CEO Ian Hares said: “This marks a significant moment in B&B’s history with all £15.65bn returned to the FSCS and ultimately the taxpayer.
"When complete, this sale will reduce UKAR’s balance sheet to £14.5bn, an 87 per cent reduction since its formation.
"The transaction delivers against our overarching objective to develop and execute divestment strategies which protect and maximise value for the taxpayer whilst treating customers fairly.”
Advertisement
Hide AdAdvertisement
Hide AdThe sale is based on the portfolio position as at the end of September, from which point the purchaser will acquire the risks and rewards of ownership of approximately 45,000 Bradford & Bingley and Mortgage Express mortgages.
UKAR said a key consideration in selecting the successful bidder was the continued fair treatment of customers and there will be no changes to the terms and conditions of the loans as a result of this transaction.
The mortgages will continue to be administered by the same company, providing continuity of service.
UKAR said that customers do not need to take any action. People who are affected by the sale will be contacted in due course to explain the change in ownership.
Advertisement
Hide AdAdvertisement
Hide AdWhen Bradford & Bingley was taken into public ownership in 2008, its customer deposit book was transferred to Santander UK and replaced by loans from HM Treasury and the FSCS. In turn the FSCS borrowed £15.65bn from HM Treasury to fund its loan to Bradford & Bingley.
These mortgages will continue to be serviced for an interim period of up to nine months by Computershare Mortgage Services, an FCA regulated company, operating under the trading name of Computershare Loan Services (CLS). The purchaser has agreed that CLS will continue to service the customer loans following the interim period.