Bradford & Bingley mortgages to be sold for £11.8bn
The government has sold its Bradford & Bingley loans book acquired by the taxpayer during the financial crisis for £11.8bn.
Chancellor Philip Hammond announced the approximate 104,000 buy-to-let loans will be sold to Prudential plc and to funds managed by Blackstone.
He confirmed there will be no change to the terms and conditions of the loans sold and that borrowers do not need to take any action. Those affected will be contacted in due course to explain the change in ownership.
When Bradford & Bingley was rescued in 2008, its customer deposit book was transferred to Santander UK and replaced by loans from the Treasury and the Financial Services Compensation Scheme (FSCS). In turn the FSCS borrowed £15.65bn from the Treasury to fund its loan to Bradford & Bingley.
The sale is expected to complete within the next few weeks and Hammond said the price achieved reflects “the strong credit of the portfolio”, helping to “deliver value for money for the taxpayer”.
Hammond said: “The sale of these Bradford & Bingley assets for £11.8bn marks another major milestone in our plan to get taxpayers’ money back following the financial crisis.
“We are determined to return the financial assets we own to the private sector and today’s sale is further proof of the confidence investors have in the UK economy.”
UK Asset Resolution (UKAR) manages Bradford & Bingley and NRAM’s closed loan books on behalf of the taxpayer.