Starting gun fired to restart sale of billions of pounds of distressed mortgages
The government is preparing to put a multi-billion pound portfolio of mortgages it manages on behalf of failed lender Bradford & Bingley back on the market.
UK Asset Resolution (UKAR) – whose role is to flog mortgages written by doomed lenders that include Bradford & Bingley and Northern Rock – signalled an end to its Brexit break by circulating non-disclosure agreements to prospective buyers.
Read more: Government to offload £16bn of Bradford and Bingley assets
"We have received the necessary approvals and can confirm that we have launched the first phase of a programme of asset sales that could ultimately enable Bradford & Bingley to repay its £15.7bn loan from the Financial Services Compensation Scheme," said a spokesperson for UKAR.
The sale was originally announced in March as part of George Osborne's budget and at the time it was hoped this would raise £15.7bn. But the process was put on the back-burner following Britain's 23 June vote to leave the EU.
Read more: Government sells £13bn-worth of Northern Rock mortgages
It is unknown exactly how much of Bradford & Bingley portfolio is slated for sale at this time but an initial tranche is likely to be put up for sale to in order to test the market.
Last year UKAR raised £13bn by selling its book of Northern Rock mortgages to US investment fund Cerberus – a debt manager that has hoovered-up a billions of pounds of distressed UK corporate and property loans following the financial crisis.