United Kingdom Asset Resolution Limited (UKAR)

25 Pages Posted: 16 Aug 2021

See all articles by Aidan Lawson

Aidan Lawson

Yale University - Yale Program on Financial Stability

Date Written: June 23, 2021


As the Global Financial Crisis began to unfold, the United Kingdom (UK) saw two of its largest mortgage lenders in Bradford & Bingley (B&B) and Northern Rock begin to weaken dramatically under the pressure that housing and financial markets were facing. Northern Rock and B&B both faced severe funding problems due to a worsening global credit crunch and both would be nationalized in 2008. Despite this effort, the crisis continued to worsen globally, and the UK government created UK Asset Resolution Limited (UKAR) on October 1, 2010. This organization’s goal was to wind down and maximize the return on the £115.8 billion in mortgages and other assets that the government still had from B&B and what was now Northern Rock Asset Management. The government transferred those assets to UKAR along with B&B’s and NRAM’s associated liabilities, including loans from HM Treasury and the Financial Services Compensation Scheme (FSCS) with a principal of £48.7 billion at the end of 2010. UKAR has been able to consistently reduce its balance sheet and turn a profit every year since its inception. As of June 2019, the company made approximately £8.1 billion in profit, as well as paying off the entirety of its government loans. More recently, the company also sold off all of its assets and equity interest, thus ending government ownership of B&B and Northern Rock in February 2021.

Keywords: UK Asset Resolution, UKAR, United Kingdom, Resolution, asset management companies, AMCs, broad-based asset management

JEL Classification: G01,G18, G28

Suggested Citation

Lawson, Aidan, United Kingdom Asset Resolution Limited (UKAR) (June 23, 2021). The Journal of Financial Crises: Vol. 3 : Iss. 2, 641-664, Available at SSRN: https://ssrn.com/abstract=3904307

Aidan Lawson (Contact Author)

Yale University - Yale Program on Financial Stability

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P.O. Box 208200
New Haven, CT 06520-8200
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