Farewell Granite

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As the FT has reported:

The vehicle that funded Northern Rock's ambitious expansion of mortgage lending has been cut loose by the state-run bank - a move that represents a shift in the wider world of mortgage finance.

The bank, advised by Credit Suisse, decided to let Granite, its £35.5bn securitisation programme or master trust, go into run-off, meaning that Northern Rock will no longer supply it with fresh mortgages and bondholders will be repaid as old mortgages expire.

Analysts believe the move makes more likely a wholesale shift away from the use of this form of funding among UK mortgage lenders.

I probably did more than anyone to drag Granite out into the open.

I welcome its demise. It was a duplicitous, amoral form of financing that fundamentally undermined good governance.

Let us hope that the era it came to represent is now over.