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03/08/2010
Northern Rock Steadfast In Recovery
The boss of a once beleaguered UK bank is "encouraged" by news that nationalised Northern Rock's - a so-called 'bad bank' - has returned to profit following heavy losses last year in the wake of a bail-out by the taxpayer in 2008.
Chief Executive Gary Hoffman said the Northern Rock 'AM' results were 'encouraging'.
He was commenting as Northern Rock Asset Management, which houses the bank's toxic loans, reported pre-tax profits of £349.7million for the first six months of the year, compared with a loss of £724.2million in the same period last year.
However the 'good' side of the bank, Northern Rock PLC, which controls savers' deposits, made a loss of £142.6million.
The results are the first for the bank since it was split in two last year after its collapse, caused by a run on its deposits when it was disclosed that it had asked the Bank of England for emergency help.
The return to profit is due to 90% of borrowers being able to meet their mortgage repayments, thanks to record low interest rates.
But the group still owes a mammoth £22.5billion to the taxpayer after Northern Rock's 2008 bail-out, having repaid only £300million in the half-year.
The run on the bank forced the Bank of England to step and provide emergency loans after customers feared losing their savings.
The loans could not stop the crisis, which then hit the banking sector in Britain and across the world.
Northern Rock was subsequently bought by the taxpayer and, as part of the plan to return the bank to private ownership, Northern Rock was split in two.
The so-called 'bad bank', Northern Rock Asset Management (AM), houses the bank's toxic loans. It has returned a £349.7million profit.
The 'good bank', Northern Rock PLC, which controls savers' deposits, returned a £142.6million loss.
In further encouraging signs, bad debts fell to £277.6million, which is significantly lower than both the first and second halves of 2009.
The arm now has £47.2billion of residential mortgages on its books.
Repossessions fell 10%, but the bank said this was because its mortgage book was shrinking, leaving more risky debts on its balance sheet.
(BMcC/GK)
Chief Executive Gary Hoffman said the Northern Rock 'AM' results were 'encouraging'.
He was commenting as Northern Rock Asset Management, which houses the bank's toxic loans, reported pre-tax profits of £349.7million for the first six months of the year, compared with a loss of £724.2million in the same period last year.
However the 'good' side of the bank, Northern Rock PLC, which controls savers' deposits, made a loss of £142.6million.
The results are the first for the bank since it was split in two last year after its collapse, caused by a run on its deposits when it was disclosed that it had asked the Bank of England for emergency help.
The return to profit is due to 90% of borrowers being able to meet their mortgage repayments, thanks to record low interest rates.
But the group still owes a mammoth £22.5billion to the taxpayer after Northern Rock's 2008 bail-out, having repaid only £300million in the half-year.
The run on the bank forced the Bank of England to step and provide emergency loans after customers feared losing their savings.
The loans could not stop the crisis, which then hit the banking sector in Britain and across the world.
Northern Rock was subsequently bought by the taxpayer and, as part of the plan to return the bank to private ownership, Northern Rock was split in two.
The so-called 'bad bank', Northern Rock Asset Management (AM), houses the bank's toxic loans. It has returned a £349.7million profit.
The 'good bank', Northern Rock PLC, which controls savers' deposits, returned a £142.6million loss.
In further encouraging signs, bad debts fell to £277.6million, which is significantly lower than both the first and second halves of 2009.
The arm now has £47.2billion of residential mortgages on its books.
Repossessions fell 10%, but the bank said this was because its mortgage book was shrinking, leaving more risky debts on its balance sheet.
(BMcC/GK)
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01 May 2008
Job Cuts Planned At Troubled Bank?
Troubled lender Northern Rock plans to axe 2,000 jobs within three years, it has been reported. The bank has been struggling since last year due to unsettling financial conditions sparked off by the global credit crunch. Long queues formed outside the bank last September as savers tried to withdraw their savings.
Job Cuts Planned At Troubled Bank?
Troubled lender Northern Rock plans to axe 2,000 jobs within three years, it has been reported. The bank has been struggling since last year due to unsettling financial conditions sparked off by the global credit crunch. Long queues formed outside the bank last September as savers tried to withdraw their savings.
18 December 2007
Northern Rock Gets Taxpayer Billions
The Government is bailing out troubled bank, Northern Rock, again. At the request of the lender, it has offered to cover any loss by financial institutions that provide money to Northern Rock so the bank can operate normal banking services.
Northern Rock Gets Taxpayer Billions
The Government is bailing out troubled bank, Northern Rock, again. At the request of the lender, it has offered to cover any loss by financial institutions that provide money to Northern Rock so the bank can operate normal banking services.
06 February 2008
Jobs Threat At Troubled Northern Rock
Virgin has reversed its promise not to cut jobs at Northern Rock if it successful in its takeover bid of the troubled lender. The move has alarmed unions who had originally vowed to fight compulsory redundancies. Virgin boss, Sir Richard Branson had previously said that he was confident there would be no redundancies under a Virgin-backed rescue.
Jobs Threat At Troubled Northern Rock
Virgin has reversed its promise not to cut jobs at Northern Rock if it successful in its takeover bid of the troubled lender. The move has alarmed unions who had originally vowed to fight compulsory redundancies. Virgin boss, Sir Richard Branson had previously said that he was confident there would be no redundancies under a Virgin-backed rescue.
18 May 2012
Northern Rock Rescue "Could Cost Taxpayer £2bn"
The National Audit Office (NAO) has estimated that taxpayers could lose almost £2bn once the assets of collapsed bank Northern Rock are wound down. The public spending watchdog also said that taxpayers lost about £480m on the sale of Northern Rock PLC last year.
Northern Rock Rescue "Could Cost Taxpayer £2bn"
The National Audit Office (NAO) has estimated that taxpayers could lose almost £2bn once the assets of collapsed bank Northern Rock are wound down. The public spending watchdog also said that taxpayers lost about £480m on the sale of Northern Rock PLC last year.
05 May 2011
Bank Of England Maintains Bank Rate At 0.5%
The Bank of England’s Monetary Policy Committee today voted to maintain the official Bank Rate paid on commercial bank reserves at 0.5%. The Committee also voted to maintain the stock of asset purchases financed by the issuance of central bank reserves at £200 billion. The previous change in Bank Rate was a reduction of 0.5 percentage points to 0.
Bank Of England Maintains Bank Rate At 0.5%
The Bank of England’s Monetary Policy Committee today voted to maintain the official Bank Rate paid on commercial bank reserves at 0.5%. The Committee also voted to maintain the stock of asset purchases financed by the issuance of central bank reserves at £200 billion. The previous change in Bank Rate was a reduction of 0.5 percentage points to 0.
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Northern Ireland WeatherToday:A showery start with outbreaks most frequent north of Lough Neagh and through the morning, before dwindling during the afternoon as the northwest breezes ease and brighter spells of weak sunshine prosper. Maximum temperature 8 °C.Tonight:A dry night, save for a few light showers around the coasts, with prolonged clear spells and light winds bringing a frosty dawn for many in central and southern parts. Minimum temperature -3 °C.
