Northern Rock’s ‘bad bank’ sees profit for first half of 2010

4 August 2010

The ‘bad bank’ part of Northern Rock has reported a pre-tax profit of £349.7 million for the first six months of 2010.

According to statistics published by the financial services provider, the figure for Northern Rock Asset Management was up on the £724.2 million loss posted during the same period last year, the BBC reported.

However, Northern Rock plc, formed to manage the mortgages and savings side of the business as part of a restructure, reported a pre-tax loss of £142.6 million for the six months.

Gary Hoffman, chief executive of Northern Rock plc, said: "Following the successful legal and capital restructure of the former business, Northern Rock plc has made solid progress. The business is stable, well capitalised and a safe home for retail deposits.

“The company is well positioned to capitalise on future growth opportunities and is now able to compete on the same terms as other banks and building societies.”

Northern Rock was nationalised in February 2008 before being split into two different divisions earlier this year.

By Jim Ottewill

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