Northern Rock reports 585m loss


Northern Rock reports 585m loss
Nationalised bank Northern Rock today announced a loss of £585.4 million for the first half of 2008.

The lender also reports a doubling of number of mortgage borrowers falling into arrears on their home loans – to 1.18 per cent of all loans.

Some 3,710 properties were repossessed

However, the bank maintains its business plan taken on after nationalisation and says it is ahead of schedule on the repayment of its loan to the Bank of England.

The Novocastrian lender repaid £9.4 billion of its loan leaving £17.5 billion owed, compared with £26.9 billion at the end of December 2007. It plans to pay off the debt in full by 2010.

Northern Rock is currently suffering losses as it is actively aiming to take borrowers of its book, but only those with higher levels of equity behind them and better credit ratings are able to switch at the end of their fixed-rate deals.

However, those with less equity and poorer credit history are left with on the bank's books.

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