Northern Rock is trying to distance itself from the European Mortgage Finance Agency project, saying the issue has become politicised.
The bank was named as a supporter of Emfa when the initiative was launched last month along with Credit Agricole, BBVA, Irish Life & Permanent and Banco Comercial Portugues.
But Emfa general manager Rob Thomas says Rock has not been happy since the issue of long-term fixed rates became politicised and is keen to distance itself from the debate.
Emfa hopes to establish a unified secondary mortgage market across the EU along the lines of US mortgage agency Fannie Mae which would facilitate the uptake of long-term fixed-rate mortgages in Europe.
Thomas says: “This does not particularly worry me. This is ultimately a political decision as it requires political support to go through. It is not about what Northern Rock thinks or does not think.”
Northern Rock director of communications Tony Armstrong says: “As a major securitiser of mortgages, we are naturally interested in any development offering a securitised market in Europe. However, while we support Emfa's plans we are not a founder member and have no financial involvement.”