UK Asset Resolution (UKAR) the company behind Bradford and Bingley and Northern Rock Asset Management (NRAM) has paid back £6.3 billion in government loan repayments in the last six months. UKAR announced the figures as part its interim results for the six months ended 30 September 2018.
Government loan repayments of £6.3bn, including the remaining £4.7bn of the Financial Services Compensation Scheme debt was paid, bringing total repayments to £44.7bn since UKAR was formed. It said that 92% of the government loans have now been repaid.
UKAR said that its balance Sheet reduced by a further £6.2bn to £13.6bn bringing the total reduction to £102.2bn (88%) since formation of UKAR in 2010. During the period, it completed the sale of £5bn B&B mortgage assets to an investor group led by Barclays Bank and agreed the sale of an £860m portfolio of equity release mortgages to Rothesay Life. The balance Sheet reduced by a further £6.2bn to £13.6bn bringing the total reduction to £102.2bn (88%) since formation of UKAR in 2010.
Reflecting reducing mortgage balances, underlying profit before tax reduced by 22% to £186.4m. Statutory profit before tax in the period was £49.5m including a £295.2m profit on the sale of customer loans more than offset by the £392.1m impact of unwinding hedges relating to the equity release mortgages. Mortgage accounts three or more months in arrears, including possessions, reduced by 15% since March 2018 bringing the total reduction to 92% since formation.
Ian Hares, Chief Executive, of UKAR said “In the first half, we repaid the remaining FSCS debt and agreed the sale of a portfolio of equity release mortgages. 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.”