Northern Rock, the state-owned bank, expects to account for about 10 per cent of the projected 45,000 home repossessions this year.

The Newcastle bank, which on Tuesday gave evidence to the Treasury select committee, said three quarters of its repossessions were customers for its riskier Together product, a mortgage bundled together with an unsecured loan. Typically these customers had loans worth about 105 per cent or more of the value of their property.