Northern Rock to report second year of losses after mortgage arrears rise

Northern Rock will report a second year of losses following a rise in arrears and bad debts, the nationalised mortgage lender said yesterday.

Mortgage arrears increased in the first three months of the year, in line with the deteriorating economic conditions, according to the bank’s first-quarter trading statement.

The size of the losses could exceed the £900m of last year, though the switch in its strategy from repaying a £27bn government loan to becoming a major engine of lending growth makes calculating the size of the loss difficult.

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