'Bad banks' give back £2.2bn

Northern Rock and B&B still owe £47bn but 'aim is to repay it and make a profit for taxpayer'

The "bad bank" parts of Northern Rock and Bradford & Bingley paid £2.15bn back to the taxpayer last year. But that still leaves the banks, which were merged as UK Asset Resolution (UKAR), with an outstanding £46.6bn owed to the Treasury.

"Our aim is to repay all that debt – to repay it and make a profit for the taxpayer," said Richard Banks, the chief executive. "We are well on course to do that having met or exceeded all our financial targets in the last year."

UKAR – which no longer does any new business but still holds more than 700,000 of what were deemed to be the most risky home loans in Northern Rock and Bradford & Bingley after they were nationalised – made a profit of £1.1bn in 2011 up from £444m.

It also paid £688m to the Government in interest, fees and corporation tax last year. In August, the Treasury raised the interest rate on part of its loans from 1.5 per cent above base rate to 5 per cent above, which will increase the interest paid in a full year by £250m.

Mr Banks said it was acceptable that the mortgage lender was "paying a more commercial rate of interest". Mr Banks added that he still expected to have paid back the vast majority of the taxpayer loans within 10 to 12 years.

UKFI, the body that holds the taxpayer stakes in the bailed-out and nationalised banks, this week said it expects the Treasury ultimately to receive between £95bn and £97bn from the sale of Northern Rock to Virgin Money and the run-off of the two "bad banks".

That is against the total of £64bn of taxpayer money pumped into them. Mr Banks said he was also pleased the number of customers who have missed three months' mortgage payments or more had fallen 14 per cent in the last year to 33,216.

He said: "Obviously low interest rates are a good thing for my customers and this business. But they are all facing increases in the cost of living which puts pressure on their ability to make mortgage payments." Mr Banks also revealed that he is now in a position to sell on portfolios of mortgages to banks or other financial institutions.

But he said: "We have received plenty of approaches but none which we would regard as sensible. Someone who is offering us 50p in the pound doesn't make sense when we are meant to be maximising the return to the taxpayer."

Northern Rock was nationalised in February 2008. Bradford and Bingley was carved up in September that year, with Santander buying the branch network and savings business and the mortgage book being nationalised.

Suggested Topics
PROMOTED VIDEO
Life and Style
Carol O'Brien, whose son Rob suffered many years of depression
healthOne mother's story of how London charity Maytree helped her son with his depression
Life and Style
food + drink
Arts and Entertainment
The cover of Dark Side of the Moon
musicCan 'The Endless River' carry on the tradition? See for yourself
News
Rob Merrick's Lobby Journalists were playing Ed Balls' Labour Party MPs. The match is an annual event which takes place ahead of the opening of the party conference
newsRob Merrick insistes 'Ed will be hurting much more than me'
Voices
A new app has been launched that enables people to have a cuddle from a stranger
voicesMaybe the new app will make it more normal to reach out to strangers
News
Liam Payne has attacked the media for reporting his tweet of support to Willie Robertson and the subsequent backlash from fans
peopleBut One Direction star insists he is not homophobic
Life and Style
healthFor Pure-O OCD sufferers this is a reality they live in
News
ebooksAn unforgettable anthology of contemporary reportage
Life and Style
Sexual health charities have campaigned for the kits to be regulated
healthAmerican woman who did tells parents there is 'nothing to be afraid of'
Life and Style
fashion
Arts and Entertainment
The John Peel Lecture has previously been given by Pete Townshend of The Who, Billy Bragg and Charlotte Church
musicGodfather of punk will speak on 'free music in a capitalist society'
News
peopleAt least it's for a worthwhile cause
News
Shoppers in Covent Garden, London, celebrate after they were the first to buy the iPhone 6, released yesterday
tech
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trainee / Experienced Recruitment Consultants

£20000 - £25000 per annum + OTE £40,000: SThree: SThree are a global FTSE 250 ...

Trainee Recruitment Consultant - Soho

£20000 - £25000 per annum + OTE £40000: SThree: As a Recruitment Consultant, y...

Trainee Recruitment Consultants - Banking & Finance

£20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...

Quantitative Risk Manager

Up to £80000: Saxton Leigh: My client, a large commodities broker, is looking ...

Day In a Page

A roller-coaster tale from the 'voice of a generation'

Not That Kind of Girl:

A roller-coaster tale from 'voice of a generation' Lena Dunham
London is not bedlam or a cradle of vice. In fact it, as much as anywhere, deserves independence

London is not bedlam or a cradle of vice

In fact it, as much as anywhere, deserves independence
Vivienne Westwood 'didn’t want' relationship with Malcolm McLaren

Vivienne Westwood 'didn’t want' relationship with McLaren

Designer 'felt pressured' into going out with Sex Pistols manager
Jourdan Dunn: Model mother

Model mother

Jordan Dunn became one of the best-paid models in the world
Apple still coolest brand – despite U2 PR disaster

Apple still the coolest brand

Despite PR disaster of free U2 album
Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments