Government sells £12bn worth of Bradford & Bingley loans

Chancellor Philip Hammond has confirmed the sale of £11.8bn worth of publicly owned mortgage loans related to defunct lender Bradford & Bingley.

UK Asset Resolution, set up to manage toxic loans left over after the banking crisis, said the sale is the first in a series to repay a loan of £15.65bn taken out by the Financial Services Compensation Scheme to bail out deposit-holders in the bank, whose branch network was sold to Spanish bank Santander when it collapsed in 2010.

The loans were bought US private equity firm Blackstone and pension, insurance and investment provider Prudential.

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The Financial Times called it "one of the largest government asset sales in Europe".

Hammond said the move was a "major milestone in our plan to get taxpayers' money back following the financial crisis".

He added: "We are determined to return the financial assets we own to the private sector and today's sale is further proof of the confidence investors have in the UK economy."

UK Asset Resolution confirmed the terms and conditions on the 104,000 mortgages will not change.

This latest sale reduces its outstanding portfolio to £22bn, says the BBC. At one time it managed loans of £116bn, mostly relating to Bradford & Bingley and Northern Rock.