B&B in £1.4bn mortgage deal

MORTGAGE lender Bradford & Bingley has set its sights on acquiring a further large book of mortgage loans this year. The group has today agreed to buy another £1.4bn worth of loans from GMAC-RFC, the General Motors subsidiary.

The agreement follows the purchase of a number of similar loan portfolios from GMAC-RFC worth some £3.1bn since September 2002. The assets will be acquired by Mortgage Express, Bradford & Bingley's specialist mortgage lending arm, and will be funded by existing resources. B&B said that all lending in the portfolios will be on residential property with a similar credit risk profile to the previous portfolios acquired.

The move will increase Bradford & Bingley's managed assets, which stood at £35.8bn in June last year, by as much as 3.9%. The company's total managed loan portfolio last June was worth £27.9bn, of which 80% was secured on residential property and 20% on commercial property. Buy-to-let accounted for about half the group's total residential lending assets.

Bradford & Bingley said today that the latest acquisition will be made in four parts, the size of which has yet to be determined, though each will be worth at least £50m, making a total value for the four of £1.4bn.

Bradford & Bingley has restructured its mortgages and property businesses over the past year. In November it announced the sale of its John Charcol mortgage broking business to a management buy-out team and earlier it sold its 300-strong chain of estate agents and chartered surveying operations to Countrywide for £44m.