Northern Rock Risk Surfaces

September 8, 2008

The now nationalized U.K. bank Northern Rock's Granite master trust is reporting a rising trend of arrears since the end of last year - delinquencies have climbed to 1.52%, which is almost four times the level recorded a year ago. The number of properties taken into possession each month has also roughly doubled. Monthly losses as of July 2008 were £2.9 million ($5.16 million), compared with £0.2 million a year ago, according to figures reported by Merrill Lynch. Northern Rock's Granite master trust has reported a much higher number of possessions than its peers, with a severe acceleration in the last three months.

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