Arrears increase at Northern Rock

British nationalised mortgage lender Northern Rock reported an increase in arrears today, but said it was making “solid progress” with its business plan.

Northern’s executive chairman, Ron Sandler, said economic conditions combined with a shrinking loan book meant mortgages three months in arrears rose to 0.95% at the end of April, compared with 0.57% at the end of December.

However, he added that the overall credit quality of the loan book remained satisfactory and at a level assumed in the bank’s strategic plan.