Bradford & Bingley gives update on mortgage sales

Bradford & Bingley gives update on mortgage sales

According to the company’s results, published today (May 25) Bradford & Bingley - which is a subsidiary of UK Asset Resolution - is exploring the possibility of a major sales programme of its mortgages.

This comes after HM Treasury revealed in March it was planning to sell off mortages owned by the government by 2018.

Bradford & Bingley was nationalised and split up after the sub-prime mortgage crisis in 2008.

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By raising £15.7bn for the FSCS, the lender hopes the lifeboat scheme can then repay its corresponding loan from HM Treasury.

Results for the year ending 31 March 2016 reveal Bradford & Bingley’s underlying profit fell by more than 13 per cent to £436m, from the 2015’s figure of £503m.

The decrease was mostly due to slower house price growth compared with the previous year.

However, underlying net operating income over the same period increased to £524.2m from the previous year’s figure of £505.7m, helped by the sale of Northern Rock loans.

Ongoing administrative expenses increased to £106.7m from March 2015’s figure of £84.7m, as B&B retained the costs associated with servicing the NRAM book.

The firm managed to reduce its balance sheet by a further £1bn, bringing the total reduction to £15.4bn, a fall of 33 per cent since UK Asset Resolution was formed in 2010.

Meanwhile, mortgage accounts which are three or more months in arrears have reduced by 20 per cent since the end of March last year to 2,803.

Earlier this month, UKAR announced it had signed a seven-year contract with Computershare for the outsourcing of mortgage servicing operations.