UK’s bad bank pays taxman another £6bn

Tim Wallace
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THE SO-CALLED bad bank made up of the remains of Northern Rock and Bradford and Bingley paid the government another £6.2bn in the last 15 months, it announced yesterday.

UK Asset Resolution (UKAR) paid £5.1bn in debt repayments and £1.1bn in other costs to the Treasury, taking the total given back to more than £10bn.

However, it still owes £38.3bn to the taxpayer.

The bad bank has been making progress selling off portfolios of loans, including making a £21.2m profit on the sale of £0.4bn of Northern Rock unsecured personal loans.

“UKAR has continued to make good progress over the past 15 months, with government loan repayments of £5.1bn bringing total repayments to over £10bn since the formation of UKAR,” said chief executive Richard Banks. “It is also pleasing to see the significant reduction in arrears due to the dedication and professionalism of colleagues proactively working with our customers to help them achieve the right outcomes.”

Arrears among its customers dived 39 per cent on the year to 15,483.

But UKAR warned that any significant increase in interest rates could push more borrowers into financial difficulties.

The bad bank reported a 15-month year because it shifted its financial calendar.

Previously it reported in calendar years ending on 31 December, but has changed to synchronise with the Treasury’s year which runs until 31 March.