The executive chairman of nationalized U.K. mortgage lender Northern Rock PLC warned that if the U.K. housing market deteriorates more sharply in coming months, it could take the bank longer than planned to repay loans it took from the Bank of England.
Still, Northern Rock is sticking to its plan to repay the debt by the end of 2010, with 75% of the money paid back by the end of 2009, senior bank officials said Tuesday.
"The present climate is such that if things were to remain as they are, I'm confident this plan can and will be delivered as Executive Chairman Ron Sandler said. However, "there is no question that if house prices were to decline seriously-5%, 10%, 15%-that...would certainly put a great deal of stress on our ability to deliver the plan," Mr. Sandler told a committee of U.K. lawmakers.
Northern Rock Chief Financial Adviser Ann Godbehere said that as of the end of March, Northern Rock owed the government about #24.1 billion, or $46.9 billion, down from #26.9 billion at the end of 2007.
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