September 27, 2018 / 7:30 AM / 6 months ago

UK sells bad bank mortgages to Rothesay Life

LONDON, Sept 27 (Reuters) - Britain’s government announced on Thursday the sale of an 860 million-pound ($1.13 billion) mortgage portfolio held by failed lenders Bradford & Bingley and Northern Rock, taking another step towards the final winding down of the firms.

“Following a highly competitive auction, these mortgages will be sold to Rothesay Life, a Financial Conduct Authority and Prudential Regulation Authority regulated firm,” the finance ministry said.

Proceeds from the sale would be used to pay down Britain’s national debt but costs relating to the unwinding of interest rate swaps held against the mortgages meant the cut in debt would be smaller than the sale proceeds, it said.

Britain’s UK Asset Resolution, a state firm managing assets of firms which fell victim to the financial crisis, owns about 13 billion pounds worth of assets after the sale, down from 21 billion pounds in September 2017 and from 116 billion pounds in 2010, it said. ($1 = 0.7627 pounds) (Writing by William Schomberg. Editing by Andrew MacAskill)

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