B&B completes purchase of Kensington loan portfolio

Bradford & Bingley announced the completion of the purchase of a mortgage loan portfolio from Kensington Mortgage Company, a wholly owned subsidiary of Kensington Group, for around 204m.

The purchase, funded from B&Bs existing resources, has been made by Mortgage Express, its wholly owned subsidiary.

The portfolio has an average loan size of approximately 122,000 and an average LTV of approximately 78%. All the loans are secured on UK residential property. In addition to reviewing the credit controls Kensington Mortgage Company employed in originating the loan portfolio,

Mortgage Express has tested the loan book using its own credit scoring processes. The portfolio has a credit profile of near prime, very light and light adverse loans and includes customers with lower credit characteristics than the Group’s standard selective lending.

The Group previously purchased a similar portfolio from Kensington Mortgage Company in February 2004 and the performance of this portfolio is in line with expectations. The Group will continue to closely monitor the performance of both portfolios against the higher returns they offer.

This latest loan portfolio acquisition will increase the B&B Group’s total managed assets, which stood at 39bn on June 30 2005, by around 0.5%.