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The 'bad bank' which runs loans granted by Northern Rock and Bradford & Bingley before their financial crisis bailouts has repaid its £48.7bn taxpayer loan.

UK Asset Resolution had not expected to repay the crisis-era loan until the mid-2020s but has been able to do so more quickly by selling off packages of loans to private equity buyers.

UKAR has 35,000 customers, fewer than around 800,000 at the outset.

The aim is to sell the last of those loans in 2020.

Northern Rock imploded when the credit crunch struck, as it was then deprived of cash on the international money markets, which it had used as a source of funds to lend to homeowners.

B&B ran into problems through an over-focus on buy-to-let and self-certification mortgages, as well as risky sub-prime mortgage-related investments.

UKAR was set up - with its £48.7bn loan - to look after those mortgages that were nationalised when Northern Rock and B&B ran into their financial difficulties in 2008.

It will now seek to find buyers for what is left of NRAM (which holds the remaining loans from Northern Rock) and B&B.

"I am delighted that, in under ten years, we have been able to repay in full the government loan of £48.7bn," said Ian Hares, UK chief executive.

"Looking forward, we are focused on the disposal of the remaining government investments in NRAM and B&B whilst ensuring that customers are appropriately protected."

UKAR which does not grant new loans and only manages existing ones, would then become a government-owned holding company. Among its responsibilities would be pensions for around 10,000 people.

The other part of Northern Rock was sold to Virgin Money in 2011.

The government has already sold off its crisis-era shareholding in Lloyds Banking Group but continues to hold a stake of more than 60% in Royal Bank of Scotland.

UKAR was created in October 2010 and since then it has cut its balance sheet by £104.4bn, including £43.5bn of customer loan repayments and £37.4bn of asset sales.

It now has 140 staff and just £5.5bn of mortgages left, 55% of which are buy-to-let mortgages.

The ´óÏó´«Ã½'s Panorama programme reported last year that Cerberus, one of the private equity buyers for the loans, had told the government it was planning to offer homeowners better mortgage deals - but had not done so.

This left homeowners trapped on high interest rates, it said. Cerberus denied the allegation.

The Financial Conduct Authority, though, is working on plans to help so-called mortgage prisoners - which include some Northern Rock and B&B customers - find lower loan rates.

shows Mr Hares was paid £650,000 last year and could receive £823,000 next year if all the performance conditions on bonuses are met, including the sell-off of the remaining loans.