TSB Bank plc today announces that it has entered into a definitive agreement to acquire £3.3 billion of former Northern Rock mortgages and loans from Cerberus Capital Management group (Cerberus). The transaction will see TSB become the mortgage lender to an additional 34,000 homeowners across the UK and reinforce TSB's position as Britain's challenger bank.
Paul Pester, TSB Chief Executive Officer, says: "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 confirmed 1will 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.
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Notes to editors
1UKAR news release: www.ukar.co.uk/media-centre/press-releases/2015
TSB was created to bring more competition to British banking - to be a real challenger to the big banks and to deliver the kind of banking the people of Britain want. TSB only serves local customers and local businesses, to help fuel local economies, because communities thriving across Britain is a good thing for all of us.
We have a simple, straightforward and transparent banking model and make clear on our website how we operate and make money. We offer the products and services people tell us they want, with none of the funny stuff people normally associate with traditional banks.
Our 4.7 million customers, award winning mobile and digital banking, nationwide network of branches and 8,600 Partners mean we are big enough to make a difference, but small enough to be an agile challenger to the entire market.
For further information about TSB Bank plc, please visit our website www.tsb.co.uk.