Advertisement

Former N Rock customers in for 1,800 pounds compensation

Individuals who were customers of Northern Rock when the bank was nationalised in 2008 may be entitled to compensation worth approximately 1,800 pounds each.

Individuals who were customers of Northern Rock when the bank was nationalised in 2008 may be entitled to compensation worth approximately 1,800 pounds each.

A statement published by Economic Secretary to the Treasury Sajid Javid, revealed that UK Asset Resolution had identified certain Consumer Credit Act (CCA) regulated loans in the Northern Rock Asset Management portfolio where the loan documentation was not compliant with CCA requirements.

Advertisement - Article continues below

The CCA provides that a lender is restricted in how it can enforce a debt and borrowers are not liable for interest over the period during which the lender has not provided the specified information. According to Javid's statement, the period of non-compliance originates from changes to the CCA implemented in 2008 before the separation of Northern Rock Asset Management and Northern Rock.

Following an internal investigation undertaken by UK Asset Resolution (UKAR), Javid stated that UKAR has recommended making proactive restitution to affected NRAM customers in receipt of non-complianty statements and default notices relating to CCA-reglated loans.

The cost to NRAM of remediating the interest charges on affected accounts is estimated at £270m. Northern Rock Asset Management estimates that some 152,000 customers were effected. If all of them are eligible, then the individual compensation will be £1776.32.

UKAR has confirmed that NRAM has the financial resources to make the remediation. NRAM's interim financial results for the six months to June 2012 show a statutory profit before taxation of £305m.

MF

Advertisement
Advertisement

Recommended

Visit/investments/investment-strategy/601044/broker-safety-your-questions-answered
Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
Visit/investments/investment-strategy/600861/how-demographics-affects-stock-valuations
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Visit/investments/stocks-and-shares/600863/sirius-minerals-anglo-american-takeover
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020
Visit/investments/stockmarkets/600634/why-investors-should-be-cautiously-bullish-for-2020
Stockmarkets

Why investors should be “cautiously bullish” for 2020

Analysts have been out in force making rosy predictions for stockmarkets in 2020, but while there is certainly a case for optimism, investors should r…
17 Jan 2020

Most Popular

Visit/economy/inflation/601584/the-end-of-the-bond-bull-market-and-the-return-of-inflation
Inflation

The end of the bond bull market and the return of inflation

Central bank stimulus, surging post-lockdown demand and the end of the 40-year bond bull market. It all points to inflation, says John Stepek. Here’s …
30 Jun 2020
Visit/investments/property/601606/house-prices-crash-uk-property-prices-falling-where-next
Property

House price crash: UK property prices are falling – so where next?

With UK property prices falling for the first time in eight years, are we about to see a house price crash? John Stepek looks at what’s behind the sli…
2 Jul 2020
Visit/investments/commodities/gold/601587/bullish-gold-price-cup-and-handle-chart-pattern
Gold

This chart pattern could be extraordinarily bullish for gold

The mother of all patterns is developing in the gold charts, says Dominic Frisby. And if everything plays out well, gold could hit a price that invest…
1 Jul 2020