Public Accounts Committee

Granite and Northern Rock inquiry

Inquiry status: Concluded

Report published 9 November 2016. Government response published 6 February 2017.

Report published

Scope of the inquiry

The disposal of former Northern Rock mortgages and loans in 2015 was the government's largest ever financial asset sale. In November 2015 the government disposed of £13.3 billion former Northern Rock mortgages and loans to a consortium led by US private equity group, Cerberus.

The sale, conducted by the UK Asset Resolution (UKAR) which is owned by HM Treasury, comprised of £11.9 billion of mortgages from the Granite debt financing vehicle within Northern Rock Asset Management (NRAM) and additional loans (£1.4 billion).

The taxpayer received £5.5 billion in cash while Cerberus took on nearly £8 billion in liabilities. Some 270,000 mortgages and loans were sold in the deal.

The Public Accounts Committee will look to examine the preparations for the sale—including its rationale and objectives, and whether it was structured in a way to deliver value for money and also the execution of the sale; including whether sufficient competitive tension existed to maximise bids, and whether consumer protection was adequately considered.

The inquiry will also look at Government's valuation of the asset, including whether the valuations were designed appropriately and based on sound assumptions, and whether the tax positions of bidders were considered appropriately.


  • 12 Sep 2016 - Granite and Northern Rock - oral evidence | PDF version (PDF263 KB) HC 632 | Published 13 Sep 2016

    Evidence given by Jerome Henrion, Head of the Financial Institutions Solutions Group, Global Markets, Credit Suisse, Jonathan, Director of Supervision, Retail and Authorisations, Financial Conduct Authority, and David Teitelbaum, Head of European Advisory Offices and Senior Managing Director, Cerberus European Capital Advisors LLP; Charles Roxburgh, Second Permanent Secretary, HM Treasury, James Leigh-Pemberton, Chairman, UK Financial Investments, and Ian Hares, Chief Executive, UK Asset Resolution (at 4.30pm).

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