Ministers To Unveil £900m Student Loan Sale

[AAD News Feed]

Ministers To Unveil £900m Student Loan Sale

This is a duplicate of the Blog Entry made on 24th November 2013 17:54.

*The Government is set to announce the privatisation of the 1990s loan book on Monday* Nearly £1bn of student loans will be offloaded by the ...

Click to Read More...

[evilcartman]

Re: Ministers To Unveil £900m Student Loan Sale

If I was a student without any property, owing tens of thousands of pounds to a private debt collector, I would either go voluntarily bankrupt or just **** off somewhere abroad for six years, until the debt is statute barred. As I understand it, they couldn't use these tactics with the Student Loan Company, as there was specific legislation preventing it. But surely this exemption would not be transferable to private debt collectors without a change in the law?

[ATW]

Re: Ministers To Unveil £900m Student Loan Sale

I thought that back in the day when these loans were being rolled out to replace grants there were all sorts of promises that they would never be sold off to private debt collectors.

[nightwatch]

Re: Ministers To Unveil £900m Student Loan Sale

just seen on Manchester evening news, Arrow global has paid 160 mill for student loans

[Handyman]

Re: Ministers To Unveil £900m Student Loan Sale

That makes it a nice 735M loss to the Nation. Did you see the Arrow's Partners are Car Val (part of Cargill's that were linked at one time with Marlin Financial).

[Handyman]

Re: Ministers To Unveil £900m Student Loan Sale

This could make things a little clearer. Strange How Arrow were only Floated on the Stock market in October.
LINK http://www.theguardian.com/money/201...-secret-report

The document, prepared by Rothschild investment bank, was submitted to the business department in November


2011, but is understood to still be under active review. It has never been made public, or been seen by higher education professionals.
But in the privatisation study, Rothschild found that the rate-cap was a major deterrent to potential investors, who worried that if inflation outstripped the base rate they would lose out on returns.
In order to sell as much of the loan book as possible, the financiers advise that the government underwrite
the risk with a financial instrument called a synthetic hedge, in effect using the public finances to guarantee returns to private investment.


Alternatively, they suggest dumping the cap on loan rates altogether. If that proves impossible, the team suggest "an 'offer of compromise', including a payment holiday, or an interest-free period or a different cap".

It's no wonder there wasn't much in the press prior to the sell off, or that it got so little coverage on TV on Monday Morning.
I also find it difficult to understand why the Auction for the Loan Book took place overnight Sunday/Monday Morning.
Looks like it's something the Treasury wanted to keep dark about.

Regards all Handy.