August 16, 2019 / 8:44 AM / 2 months ago

PwC to manage remnants of Britain's 'bad bank'

FILE PHOTO: A bird flies past the logo of Price Waterhouse installed on the facade of its office in Mumbai, India, January 11, 2018. REUTERS/Danish Siddiqui

LONDON (Reuters) - Consultancy PwC has been appointed to run the remnants of Britain’s ‘bad bank’ that snapped up assets from collapsed lenders Northern Rock and Bradford & Bingley in the financial crisis.

The auditor, criticised by politicians for failing to flag problems at Northern Rock in audits prior to its failure in 2007, has been awarded a 16.5 million pound contract to manage UK Asset Resolution’s (UKAR) remaining business, according to a government contract notice posted online.

The Financial Times first reported the PwC appointment, including criticism from a senior politician of the choice.

UKAR, owned by the British Treasury, was set up to manage more than 100 billion pounds of assets from the two failed lenders.

Following a string of asset sales, UKAR’s balance sheet was slashed to 8 billion pounds by April this year and it was later able to repay the last of the 48.7 billion pound of state loans it used to fund the bailouts.

A UKAR spokesman said the organisation would retain responsibility for the holding company.

“Using the Official Journal of the EU (OJEU) process, we have agreed to outsource this work to PwC once UKAR has completed its objective,” the spokesman said.

PwC said it was unable to comment on client work.

Reporting by Iain Withers; Editing by Mark Potter

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