Northern Rock to offer 90% mortgages

Northern Rock, the British bank nationalised during the credit crisis, is preparing to launch a series of mortgages that offer up to 90% of a property's value, according to reports.

The Financial Times said the lender could make the riskier new high loan-to-value mortgages available as early as Monday.

Northern Rock was nationalised three years ago after becoming the first major British bank in more than 150 years to suffer a bank run.

The government has long been keen on returning the bank to the private sector, since selling it would raise cash to help cut the country's troublesome deficit.

Options for Northern Rock include a sale, stock market flotation or "remutualisation" - turning Northern Rock into a company owned by its customers, such as UK loans and savings group Nationwide.

Analysts consider that an eventual sale of Northern Rock is the most likely outcome for the business.

Virgin Money, supermarket retailer Tesco's banking arm and private equity firm JC Flowers have been cited as possible acquirers.