TSB Bank plc has entered into a definitive agreement to acquire £3.3 billion of former Northern Rock mortgages and loans from Cerberus Capital Management group.
This will mean TSB becomes the mortgage lender to an additional 34,000 homeowners across the UK.
Paul Pester, TSB’s CEO, said: “We’re delighted to become the lender to 34,000 new customers across the UK and provide a secure, long-term home for these mortgages. Supporting hardworking people and helping local communities right across Britain to thrive is absolutely at the heart of what TSB was set up to do.
“With one of the highest capital ratios in the industry, TSB is well placed to support the loans. In addition, they will significantly enhance TSB’s profitability which, in turn, will help us to continue to deliver our growth strategy – helping us to bring more competition to UK banking.”
The portfolio comprises residential mortgages (and linked unsecured loans) from the legacy book of NRAM plc (the former Northern Rock mortgage business), which UK Asset Resolution Limited (UKAR) has today confirmed1will be sold to Cerberus.
The terms and conditions of the existing loan agreements will remain unchanged and UKAR’s mortgage servicing arm will continue to service the loans, ensuring continuity in service for borrowers.