George Osborne agreed a £13 billion sale of Northern Rock mortgages last month in what is the largest ever financial asset sale by a government in Europe.
The mortgages are being sold by UKAR to Cerberus, and TSB has confirmed that it has entered into a definitive agreement to acquire £3.3 billion of the mortgages and loans.
UKAR is selling the portfolio for £280 million more than their book value, and the government has now exited over 85% of the assets of the former bank.
Commenting on the correspondence, Mr Tyrie said:
“Seven years after the taxpayer bailed out Northern Rock, it’s good news that the Chancellor has managed to sell these assets.
“Concerns have been raised about the suitability of Cerberus as the buyer of the mortgage book. This merits further scrutiny. The Treasury should consider not just short term profitability, but also longer term value in its asset sales. The impact on future tax revenues – as a result of a company’s international tax arrangements – should be taken in to account.
“Furthermore, the interests of customers need to be considered even after an asset is off the government’s books. Those customers, understandably, will want assurance that they will not be adversely affected as a direct result of this sale.
“In the minister’s letter to me, she clarified that in her view ‘there will be no changes to the terms and conditions of the mortgages that have been sold. Customers do not need to take any action as a result of this sale’. That requires some substantiation. I have written to her for it. Her answers to a number of Parliamentary Questions on this have so far added little to her original statement.”
