Solihull’s Paragon ‘to swoop on Northern Rock’
SOLIHULL-based buy-to-let mortgage provider Paragon has been linked to a potential bid for Northern Rock.
Paragon has asked for information on the sale of the state-owned bank, joining the Coventry Building Society on the list of suitors.
Reports over the weekend claimed that Paragon could launch a bid for the whole of Northern Rock or just part of its loan book.
Paragon announced a 35% increase in profits earlier this year, after effectively restarting its lending operations which it mothballed after the 2008 credit crunch.
The company said it had benefited from its lending relaunch and it said strong growth in completions was expected in the second half of the year.
It said its portfolio had performed well with buy-to-let arrears continuing to fall and remaining significantly below industry average.
Speaking in May, chief executive Nigel Terrington said additional opportunities were ‘under review’.
The sale of Northern Rock was announced by the Chancellor George Osborne in his Mansion House speech last month.
Industry analysts believe the sale is unlikely to generate more than £1bn for the taxpayer. Other bidders could include Virgin Money and NBNK. Northern Rock was nationalised in February 2008 after it collapsed amid the credit crisis.
