An Australian-owned company has emerged as a frontrunner to take on a UK taxpayer-owned mortgage business, Sky News learns.
Sky News has learnt that UK Asset Resolution (UKAR) is in advanced talks about an arrangement which would see its mortgage servicing unit transferred to a private sector operator under a long-term contract.
Sources said on Monday that Capita, the outsourcing giant, was in competition with an Australian-owned company to take on the UKAR Corporate Services division.
A Treasury insider said that HML, a division of Computershare, was the frontrunner to secure a deal although they cautioned that it remained finely balanced.
A decision about the outcome and the terms of an agreement could come as soon as this month, they said.
The mortgage servicing platform, which administers the Government's Help to Buy scheme, is seen as an attractive asset because of its technology capability and the prospect for it to take on a broader range of business across the banking industry.
If successfully concluded, a deal would follow the £13bn sale of Granite, a securitisation vehicle established by Northern Rock in 2001.
It would also come as ministers prepare for a review of options for a £17bn Bradford & Bingley loan-book, which if sold would be the largest such sell-off in UK history.
Mr Osborne hailed the Granite sale in November as "another major milestone in clearing up the mess left by the financial crisis", saying it was the largest-ever sale of financial assets by a British government.
"We are now clear that taxpayers will get back more money from Northern Rock than they were forced to put in during the financial crisis.
"The highly competitive process, unprecedented scale, and the fact that these mortgages have been sold for almost £300m more than their book value demonstrates the confidence investors have in the UK, which has only been made possible by the success of our long term plan," the Chancellor said.
However, the Granite sale has attracted the scrutiny of MPs, in relation to both the identity of the buyer - Cerberus, a US investor - and the nature of the protection for customers.
B&B was bailed out by the Labour government in September 2008, with Santander UK buying its retail deposit business and the bank's remaining assets and liabilities - principally comprising its mortgage book, personal loan book, headquarters and relevant staff, and treasury assets and its wholesale liabilities - taken into public ownership.
UKAR declined to comment on the prospective Corporate Services deal.