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Rock sees record profits

Northern Rock saw record profits last year with an 18 per cent rise to £326m from £276m in 2001.

Income rose to £561m from £476m. Gross mortgage lending rose to the highest-ever level for the firm at £14.1bn, with £1.5bn from the acquisition of Legal & General Bank. The lending figure was a 60 per cent leap from 2001&#39s total of £8.9bn.

Net lending amounted to £8.2bn, up by 61 per cent from £5.1bn.

On the downside, there was a slight increase in residential mortgage borrowers in arrears to 2,737 from 2,525. However, this accounted for just 0.6 per cent of lending.

Northern Rock says its Together mortgage, which combines a secured and unsecured loan at one interest rate, accounted for 31 per cent of new residential lending.

Chief executive Adam Applegarth says: “The housing market is set to be quieter in 2003. The economic fundamentals of low interest rates, low inflation, low unemployment and a very limited increase in the supply of new housing stock will continue to underpin the market.

“Our low costs, relative size and ability to retain existing customers mean we remain confident of achieving our targets, confirming that our virtuous circle strategy is in very good shape.”

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