Northern Rock announces £200 million profit in first six months of 2010
Northern Rock, the former darling of the UK mortgage arena, would appear to have recovered from lows hit during the recession to report a profit of £200 million for the first six months of 2010. The company was split into two different entities by the UK government, the retail division (which reported a loss of £142 million) and the so-called "bad bank" division (which reported a profit of £349 million) although the results were issued on a combined basis.
The bad bank effectively contains the so-called toxic loans and mortgages taken on by the company in its heyday, many of which would appear to be at risk of potential default. Despite the fact that the company has effectively moved back in profitability, when taking both divisions into account, it is worth noting that £22 billion in loans are still owed to the UK taxpayer. It is unclear when taxpayers will receive any significant repayment on the outstanding debt but there are hopes that as the profitability of the two operations recovers in the medium to longer term, taxpayers will receive a return.
The future of the two divisions of Northern Rock is still shrouded in mystery although the government would bite off the hand of any potential bidders to step forward with "reasonable offers".
Share this..
Related stories
Co-operative Bank turns down £100 million of unethical business
In a sign of the times, the Co-operative Bank has today confirmed that last year it turned down the opportunity to invest in 20 financial arrangements which breached the company's ethical guidelines. The company has a number of these ethical guidelines in relation to human rights, the arms trade and the environment. It is unclear exactly what opportunities were turned down but the very fact they w...
Read MoreBroker faces jail over £3 million share gamble
Jonathan Bunn, a former broker with Lewis Charles Securities, is this week facing a potential jail sentence after he admitted falsifying documents to conceal massive unauthorized trades in HSBC shares. The broker admits it to shorting HSBC shares between 22 July and 30 July 2009 and falsifying dealing slips to give the impression his trades were matched against those of clients. In effect Mr Bu...
Read MoreTakeover panel criticises acquisition of Cadbury
The UK takeover panel has today issued a damning indictment on the actions and activities of Kraft Foods before, during and after the acquisition of Cadbury. The £11 billion acquisition was dogged by controversy from day one and today we saw a major victim in the UK when Peter Kiernan was forced to pull out of the running to be the new director-general of the takeover panel due to his connection...
Read MoreFTSE 100 edging closer to 5000 level
It has been a difficult few days for the FTSE 100 index which fell a further 54 points today to 5046.47 as investors become more and more concerned about the UK economy and the outlook for the worldwide economy. Even though George Osborne's budget was fairly well-received within the city it seems that the reality of the UK economic situation is only now starting to hit home with many people and so...
Read MoreLondon Stock Exchange reveals Turquoise investment
As expected, the London Stock Exchange has today confirmed it has taken a majority stake in alternative trading platform Turquoise, a venture which many people had believed would initially cause concerns for the London Stock Exchange. However, after £40 million start-up costs and £15 million of losses the banks behind the venture have effectively given up and handed control to the London Stock E...
Read More