Reduced losses for Northern Rock
Nationalised lender Northern Rock has said it expects to make a profit during next year after reporting reduced half-year losses.
The bank also confirmed it has received indicative offers from interested parties since Chancellor George Osborne announced in June his decision to put Northern Rock up for sale.
The lender reported underlying losses of £78.8 million in the six months to June, compared with losses of £140 million the previous year.
Northern Rock was nationalised in February 2008 after it collapsed amid the credit crisis, sparking the first run on a UK bank for 150 years.
Looking ahead, the company said it expects to be loss-making for the full year but with a "significantly improved position" compared with last year.
Ron Sandler, Northern's Government-appointed chairman, said: "The trading environment remains challenging and there is strong competition in the savings and mortgage markets. The company expects to be trading profitably during the second half of 2012."
Northern Rock plc is being sold by UKFI, which was set up to manage the state's holding in banks bailed out during the crisis, such as Lloyds and Royal Bank of Scotland.
Virgin Money and US private equity investor JC Flowers are understood to have tabled first-round bids for the bank last week, although a report at the weekend said the sale is likely to deliver a loss for taxpayers of £400 million as both firms have indicated offers of £900 million to £1 billion. The Government had pumped £1.4 billion into the bank.
Mr Sandler added: "We are pleased with the level of interest we have received, and will continue to explore the sale option over the coming months. In the meantime, it is business as usual."
The Government split Northern Rock in two at the start of 2010, forming a mortgage and savings bank called Northern Rock plc and Northern Rock Asset Management (NRAM) to house the more toxic loans. NRAM last month reported a surge in pre-tax profits in the six months to June to £344.1 million, from £181.8 million last year.