Following the successful completion of the legal and capital restructure of the Northern Rock business, on 1 January 2010, the newly created good bank, Northern Rock plc, has confirmed that it has been authorised by the FSA as a new savings and mortgage bank. Bad bank is named as Northern Rock (Asset Management).
The legal split is expected to clear the path for potential bidders to enter the fray, with Virgin Money and National Australia Bank are said to be among the suitors.
Northern Rock will be in temporary public ownership and regulated by the FSA as a deposit taker and mortgage lender. It holds and services retail savings balances of approximately GBP19bn and approximately GBP10bn of residential mortgages. It offers new savings products and new mortgage lending. It also holds certain wholesale deposits.
Gary Hoffman, CEO, said: “I am pleased to announce that we have successfully completed the legal and capital restructure of the business. This helps to build a stronger future and delivers value to taxpayers. All savings accounts have been transferred to the new bank and we are writing to our savings customers to confirm that.
“We are also writing to mortgage customers of the new bank to confirm that their accounts have been transferred as part of the restructure. Our aim was to make this process as smooth as possible for all of our customers. They do not need to take any action and can continue to contact us in the usual ways.”
