Taxpayers see a profit on Northern Rock bailout
Taxpayers will get back more money from Northern Rock than they were forced to put in during the financial crisis, according to the Government.
The completion of a record-breaking £13bn sale of former Northern Rock mortgages was announced today and the government received the final £520m from Cerberus as part of the conclusion of this sale.
The mortgages, which were originally owned by Northern Rock and were acquired by the government during the financial crisis, were sold by UK Asset Resolution (UKAR) to Cerberus.
The sale, authorised by the Chancellor and announced last November, is the largest ever financial asset sale by a government in Europe.
UKAR sold this portfolio of mortgages for £280m more than their book value.
A key consideration for UKAR in selecting the successful bidder was the treatment of customers. There will be no changes to the terms and conditions of the mortgages sold. Customers do not need to take any action.
Economic Secretary to the Treasury, Harriett Baldwin said: “Today marks another major milestone in clearing up the mess left by the financial crisis, with the government completing the sale of former Northern Rock mortgages.
“Today’s receipt of the final funds from this sale mean that we now have even further confidence that taxpayers will get back more money from Northern Rock than they were forced to put in during the financial crisis.”