Northern Rock posts reduced losses

Wednesday, 03 August 2011 11:01

Northern Rock has announced "significantly" reduced losses in the first six months of 2011.

In its half-year results, the nationalised bank reported an underlying loss of £78.8 million between January and June, compared with £140 million for the same period in 2010.

The company expects to record a profit in 2012 and "continues to prepare for a return to private ownership".

Executive chairman Ron Sandler said the firm had made "good progress" this year amid strong competition in the savings and mortgage markets.

"We are carefully managing the product mix to sustain margins and improve income and we continue to take steps to align the cost base with the income generating capacity of the company," he added.

Mr Sandler went on to point out that Northern Rock is working closely with advisers and UK Financial Investments Limited over a potential sale and is pleased with the level of interest so far.

Northern Rock was nationalised three years ago in the middle of the financial crisis and has since been split into two parts, one comprising its mortgages and savings and the other holding its bad assets.

The former is the one that is to be sold, with chancellor George Osborne determined to find a buyer this year.

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