The nationalised United Kingdom bank Northern Rock, whose failure started the near-collapse of the countrys banks, has reported pre-tax losses of GBP 1.36 billion (1.53 billion Euro) and held a total of 3,620 repossessed homes at the end of 2008 63 percent more than at the same stage a year earlier. Northern Rock said that its repossessed stocks peaked at 4,201 at the end of September, before easing back slightly towards the end of the year.

The state-owned bank said repossession is a last resort and has committed not to seize an owner-occupied home for at least six months after they fall into arrears. But the overall rise during 2008 is due to Northern Rock being left with riskier customers as the bank drove higher-quality borrowers elsewhere to pay off its huge Bank of England loans. The plans to shrink the business saw its overall residential mortgage book fall 27 percent to GBP 66.7 billion (75.2 billion Euro,) but arrears jumped sharply. A total of 17,264 of its borrowers are three months or more in arrears - nearly five times as many as a year earlier.

The banks infamous Together mortgage - which lent up to 125 percent of the value of a home before being pulled in February 2008 - now accounts for 29 percent of its mortgage book, up from 24 percent a year ago. Northern Rock took GBP 23.6 billion (26.6 billion Euro) out of the mortgage market last year as customers moved elsewhere, paying off GBP 18 billion (20.29 billion Euro) of the GBP 26.9 billion (30.3 billion Euro) it owed the Bank of England in the process. But the bank will slow the pace of its redemptions in a bid to ease the current mortgage drought and last week announced plans to offer up to GBP 14 billion (15.78 billion Euro) in new lending over the next two years, even though the recession gripping the country shows no signs of relenting.