A US investment firm has emerged as the preferred bidder to buy a £13bn tranche of Northern Rock mortgages.
The Sunday Times reports New York-based Cerberus Capital Management has teamed up with Morgan Stanley as part of its bid for the loan book.
The investment fund has been caught up in a bribery scandal involving its acquisition of a $5.7bn (£4.2bn) loan book from Irish “bad bank” Nama.
The Northern Rock loan book is made up of more than 131,000 home loans, including Northern Rock’s Together mortgages which lent to borrowers at 125 per cent LTV.
UK Asset Resolution, which manages the loans, and Morgan Stanley declined to comment. Cerberus was unavailable for comment.