Government eyes £6bn sale of B&B mortgages

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The Government is eyeing a £6bn sale of residential and buy-to-let mortgages from Bradford & Bingley, GMAC-RFC and Kensington Mortgages, according to reports.

The bulk of the £6bn will be made up of B&B mortgages, according to Sky News.

The Treasury had originally earmarked £3bn of loans to be sold this year but has recently upped its estimate.

Morgan Stanley has been appointed to oversee the auction.

The sale would be made up of high-LTV residential mortgages and “low quality’ buy-to-let.

The mooted £6bn sale adds to an £3bn auction of B&B mortgages announced in February this year.

The earlier sale involved Prudential and Paragon Bank bidding for a £3bn tranche of the £12.5bn book of B&B buy-to-let loans.

Other bidders included US asset manager Pimco, private equity firms Blackstone and Cerberus and hedge funds CarVal, Elliott and Och-Ziff.