Thursday, April 23, 2009
Your “high quality mortgage book” at work
Problem loans on Northern Rock's mortgage book have almost doubled in just six months as the poor quality of the bank's lending continues to unwind. In March, 3.67% of its customers were in arrears by 3 months or more, up from 2.92% in December and 1.88% in September. In contrast, the industry average is 1.87%. The nationalized lender has warned there is worse to come, and that it will be "substantially loss-making" in 2009. One in three of NR's customers are in negative equity, many of them after taking out the infamous 125% "Together" mortgages. NR plans to increase its lending by £14billion over the next two years.