UK Asset Resolution (UKAR), Britain’s ‘bad bank’, has agreed to sell a portfolio of former Northern Rock loans to U.S. private equity firm J.C. Flowers and debt recovery business Marlin Financial for a combined 400 million pounds ($615 million), Reuters reported.
(Reuters) – UK Asset Resolution (UKAR), Britain’s ‘bad bank’, has agreed to sell a portfolio of former Northern Rock loans to U.S. private equity firm J.C. Flowers and debt recovery business Marlin Financial for a combined 400 million pounds ($615 million).
UKAR is selling the portfolio’s performing loans to OneSavings Bank, a small regional lender owned by JC Flowers, with the remainder being bought by Marlin. The size of the individual transactions were not disclosed.
UKAR is a so-called zombie bank that does not take new business and is winding down the loans of Northern Rock and Bradford & Bingley, which were nationalized during the 2008 financial crisis. It has said it will accelerate the run-off by selling books of loans when it can.
The bank said the sale formed part of that process while maximizing value for the taxpayer. It said the deal would not affect the terms and conditions of the loans for the 140,000 customers affected.
After being nationalized, Northern Rock’s business was split into two companies. A ‘good’ bank that was open to new business was sold to Richard Branson’s Virgin Money, while the book of old loans were handed over to UKAR.
($1 = 0.6508 British pounds)
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