Northern Rock makes govt loan repayment

2 March 2012

Northern Rock Asset Management (NRAM) has made a sizeable repayment on the government loan it received in 2011.

The institute - dubbed the 'bad bank' that looks after Northern Rock's mortgage book - paid £2 billion on the agreement, but still owes a further £19.7 billion, according to the company in charge of reducing the NRAM's and Bradford & Bingley's bad loans.

UK Asset Resolution (UKAR), a firm established in 2010 that supports more than 722,000 customers, revealed NRAM enjoyed a pre-tax profit of £789.9 million in 2011, which was considerably greater than the £191.3 million it experienced a year earlier.

Chairman of UKAR Richard Pym noted it was "our expectation and our determination" to be able to fully pay back what it owed, without it costing the taxpayer a penny.

As a whole, UKAR - which comprises both NRAM and Bradford & Bingley - experienced a profits increase from £444.1 million to £1.1 billion between 2010 and 2011.

By Claire Archer

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