THE state-owned company that runs nationalised Northern Rock Asset Management and Bradford & Bingley said both businesses returned to profit last year.
UK Asset Resolution said Northern Rock Asset Management – spun-off from the so-called “good” part of nationalised Northern Rock last year – made underlying profits of £277.4m in 2010 against a £313.4m loss the year before.
Bradford & Bingley made underlying profits of £200.1m in 2010 compared with losses of £166.5m in 2009.
Later, Coventry Building Society said it believed Northern Rock customers would benefit if it were to take over the nationalised lender.
Britain’s third biggest mutual was responding to reports that it was preparing a bid to acquire Northern Rock from the taxpayer.
The Government split Northern Rock in two at the start of last year, forming a mortgage and savings bank called Northern Rock plc and Northern Rock Asset Management (NRAM) to house the more toxic loans, which was later merged with B&B.
Northern Rock plc said it remained in the red earlier this month, reporting a £232.4m pre-tax loss for 2010.
UKAR said the 850,000 customers within both banks benefited from rock-bottom interest rates as the Bank of England’s base rate stayed at a record low of 0.5% throughout the year.
This led to an improvement in the number of borrowers struggling with repayments.
NRAM said the number of mortgages falling into arrears for three months or more increased by 3% to 25,419 in 2010.
But the rate of increases was at a lower level than in the previous year when there was an 18% rise, it said.
B&B said the number of mortgages in arrears fell by 32% to 13,096.
