Former specialist lender Mortgages PLC is believed to have outsourced more than £3bn of its mortgage book to HML, prompting rumours it could return to the lending market.
As part of the deal, Mortgage Strategy understands that MPLC has transferred up to 25 staff to HML.
Merrill Lynch took over MPLC in 2004, but was subsequently itself bought by Bank of America.
It pulled out of the UK sub-prime market in April 2008 and MPLC has since been focussing on servicing and administering its assets.
But sources say that following the deal with HML, MPLC is considering various options and one of these is a return to mortgage lending.
One source says: “MPLC still has the technology in place from the days when it used to lend, and if it is looking to relaunch into the prime market it clearly has the infrastructure to do so.”
According to its most recent accounts, MPLC’s mortgage portfolio totalled some £4.3bn at the end of 2008. Skipton Building Society owned
HML already has around £50bn of assets under management.
Both Bank of America and HML declined to comment.