Speaking at a Treasury select committee session yesterday, Hoffman said he thought it would be possible to repay 50 per cent of the loan over the next three to four years.
Northern Rock Asset Management, which was created last week when the lender was split in two, has the remaining Government loan.
He said: “It is in our interests to give customers good deals and repay the Government debt – and I think, so far, we’ve shown we can do that.”
The loan will be repaid over time by the natural maturity of Northern Rock Asset Management’s mortgage book – which, he said, means it could take up to 20 years.
He says: “I think there will be significant repayment over the next three or four years – say, 50 per cent of it would be repaid.
“But then, because we don’t want to force customers to redeem, like we were in 2008, it would be the natural maturity of mortgages that will repay the government debt.”