Northern Rock owner repays £1.9bn to taxpayers

Northern Rock sign Northern Rock was nationalised after collapsing under a mountain of debt

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UK Asset Resolution (UKAR), the government-owned company incorporating Northern Rock (Asset Management) and Bradford & Bingley, paid back £1.9bn to taxpayers in the first half of 2013.

It said the amount included £1.3bn of loan repayments in the first half of 2013.

The firm did not make any further provision for PPI mis-selling.

It also saw profits boosted by a drop in customers who had fallen behind on their mortgage payments.

Underlying profit before tax for the first half of 2013 increased from £481.4m in June 2012 to £528.8m this year.

UKAR said the main driver for this was lower arrears and, as such, a reduced loan impairment charge.

The company saw the number of mortgages three or more months in arrears fall by 17% to 21,332 since the start of 2013.

It now has almost 584,000 customers, with 565,000 mortgage accounts and 212,000 unsecured personal loan accounts.

The firm said the majority of these loans continued to perform well, with more than 90% of mortgage customers up to date with their mortgage payments.

"However, we do have a significant number of customers who are finding it difficult to meet their repayments," the company said.

"In those cases, we work closely with customers to offer a range of solutions to help them manage their circumstances."

The number of properties it repossessed fell from 3,871 in the first half of 2012 to 3,550 in 2013.

UKAR added there were signs that a modest recovery of the UK economy was emerging, both in the wider economy and in the housing and mortgage markets, but added it was aware that the finances of many households remained under pressure.

The company was formed in 2010 to integrate the mortgage operations of Northern Rock Asset Management (NRAM) and Bradford & Bingley (B&B) following their nationalisation.

Northern Rock plc was sold to Virgin Money in 2011.

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