Northern Rock

Northern Rock (Asset Management) plc

Type	Public ownership[1][2]
Industry	Bank
Founded	1965 Renamed as Northern Rock (Asset Management) in 2010
Headquarters	Northern Rock House, Gosforth, Newcastle upon Tyne, England, UK
Area served	UK
Services	Mortgages
Owner(s)	Her Majesty's Government (UKFI / UK Asset Resolution Ltd)
Website	www.n-ram.co.uk

Northern Rock (Asset Management) plc (also referred to as NRAM) is a British asset holding and management company which was split away from the Northern Rock bank in 2010. It is currently under public ownership, due to the bank's nationalisation in 2008. The company continues to service a residential mortgage book of approximately £50 billion.

Virgin Money now own the "good bank" side of Northern Rock plc, however the government have said that they will not be selling Northern Rock (Asset Management).^[3]

History

Northern Rock (Asset Management) plc was renamed from Northern Rock plc on 31 December 2009, and the following day the banking assets were split off into a new company called Northern Rock plc. Therefore current legal entity which exists as Northern Rock (Asset Management) company is in fact the company of the Northern Rock Building Society (founded 1965) which turned into a bank in 1997.

On 14 September 2007, during the financial crisis of 2007–2010, the Bank sought and received a liquidity support facility from the Bank of England,^[4] following problems in the credit markets caused by the US subprime mortgage financial crisis. At 00:01 on 22 February 2008 the bank was taken into state ownership (see the Nationalisation of Northern Rock). The nationalisation was a result of two unsuccessful bids to take over the bank, neither being able to fully commit to repayment of taxpayers' money.^[5][6] To better control the assets of the bank it was decided to split the company in two, forming the new bank and leaving this company as the so-called 'bad-bank'.

On 24 March 2010 UKFI announced its intention to integrate Northern Rock (Asset Management) plc and Bradford & Bingley plc under a single holding company.^[7] On 1 October it was announced that Bradford & Bingley plc and Northern Rock (Asset Management) plc had been merged under a single holding company U.K. Asset Resolution Ltd.^[8]

On 3 August 2010 the company announced pre-tax profits £349.7m for the first six months of the year.^[9] On 1 October 2010 the bank announced that another £700 million had been paid off of the loan in the last three months.^[10]

During 2011 £2 billion of the loan was repaid.^[11]

UKAR / NRAM are to leave their Gosforth (Northern Rock) offices by 2013, and move their remaining staff for Doxford and Bingley.^[12]

Operations

Northern Rock (Asset Management) holds and services the majority of existing mortgage and unsecured loan accounts. The company does not offer any new products and has no branches.

Location

The black 1990s Northern Rock buildings at Regent Centre in Gosforth. One of the buildings built in the 2000s can also be seen

The Northern Rock (Asset Management) is based on the same large site at the Regent Centre in Gosforth, Newcastle upon Tyne as the Northern Rock bank. The staff will leave this site by 2013 and be based at UKAR's other sites in Doxford and Bingley.

Corporate image

Another section of the bank's Gosforth site.

Northern Rock (Asset Management)'s logo is the letter NRAM underlined and in grey. Initially Northern Rock (Asset Management) used the same corporate identity as the bank; this was introduced in 2000 and consists of a magenta square containing the company name.^[13]

Shares

HM Treasury announced on 22 February 2008 that it had acquired all the shares in Northern Rock and that all entitlements to shares issued by the company had been extinguished by a Transfer Order made under the Banking (Special Provisions) Act 2008. The Transfer Order came into force, and the transfers under it were made at 00:01 on 22 February 2008. Therefore shares cannot be bought or sold.

Permanent Subordinated Bonds (PSBs) were issued by Northern Rock and although the fixed dividend payments are currently suspended the PSBs are still traded (symbol NRKP). Their coupon is 12 5/8% and as at January 2012 they trade at just under half their issue price of 100p. Although interest is not currently paid it may be at some future point should NRAM cease to be government owned and in that case all back payments of interest may become payable.^{[citation needed]}

Board of directors

Since the company split into two parts, each separate entity has had its own board of directors. With the merger of this company with the mortgage assets of Bradford & Bingley under a single holding company, Richard Pym, Chairman of both companies is to be appointed Chairman new holding company, and Richard Banks, currently Managing Director of Bradford & Bingley has been appointed Chief Executive designate.^[14]

Northern Rock (Asset Management) board as of 1 January 2011:

• Chairman: Richard Pym
• Chief Executive: Richard Banks
• Executive Directors: Andy Tate
• Non-Executive Directors: Kent Atkinson, Sue Langley, Keith Morgan, Philip Remnant

See also

• Northern Rock
• Granite (Northern Rock vehicle)
• Nationalisation of Northern Rock
• Partnership House
• UK Financial Investments Limited
• Banking (Special Provisions) Act 2008
• UK Asset Resolution Ltd

References

External links

Wikimedia Commons has media related to: Northern Rock

• NRAM - Northern Rock (Asset Management) plc

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Coordinates: 55°00′37″N 1°37′34″W / 55.0104°N 1.6260°W / 55.0104; -1.6260