This agreement follows the successful purchase of a number of loan portfolios from GMAC-RFC, for a total consideration of £2.0 billion, since September 2002.
The acquisition will be made in four tranches, the size of which will be determined by Mortgage Express. The minimum consideration for each of the four tranches will be £100 million, and a maximum of £350m.
If the maximum mortgage assets of £1.4bn are purchased, this will increase the Group's managed assets, which stood at £29.4 billion on 30th June 2003, by up to 4.8%. Although the mix of the mortgages acquired will not be finalised until Mortgage Express exercises its option to buy, the portfolio will have similar characteristics to the portfolios the Group previously acquired from GMAC-RFC in September 2002, March 2003 and under the agreement signed in April 2003.
All lending in the portfolios will be secured on residential property and of a credit risk profile comparable to the previous £2.0 billion of similar portfolios acquired. In addition to reviewing the credit controls GMAC-RFC employed in originating the loan portfolios, Mortgage Express will further test the loan books using its own credit scoring process to confirm that they meet the Group's credit standards.
Tim Dawson, MD Mortgage Express, comments: "The strategic partnership established with GMAC-RFC continues to flourish and provides an excellent stream of high quality lending similar to MX' own lending and will support the strong organic growth achieved by Mortgage Express."
Stephen Hynes, Capital Markets Director of GMAC-RFC comments:
"As the leading creator and trader of mortgage assets in the UK, portfolio sales are a core part of our strategy. We are delighted to have concluded another agreement with Bradford & Bingley, which follows the success of similar transactions with the Group worth £2 billion since 2002. This consolidates the strong working relationship we have already established with the Group."
