Cerberus is buying a portfolio of UK legacy loans and an asset management platform for £13bn (€18.3bn).

The US private equity firm said it agreed to take the portfolio of former Northern Rock mortgages off the government-owned UK Asset Resolution.

Cerberus is also buying the loan book’s asset manager, NRAM, spun out of Northern Rock in 2010.

The portfolio includes £12bn in loans, held in the securitisation vehicle Granite, as well as other legacy mortgages of NRAM.

UKAR’s mortgage servicing arm will to continue to service the loans.

TSB Bank, meanwhile, will buy £3.3bn of the former Northern Rock mortgages and loans from Cerberus.

TSB, spun out of Lloyds Banking Group, was bought by Banco Sabadell in June this year.

John Snow, Cerberus chairman, said the portfolio was an important addition and showed the company’s commitment to European mortgage and real estate investment.

Cerberus bought Capital Home Loans, a buy-to-let mortgage lender, in July.

Investing in European non-performing loan portfolios has become Cerberus’s largest business segment, with more than $17bn (€15.8bn) of transactions since 2010.

The San Francisco Employees’ Retirement System recently made its first-ever investment with Cerberus, with a $100m commitment into its Institutional Real Estate Partners IV fund.

The fund, which has a targeted capital raise of $1.5bn and a hard cap of $2bn, has a planned final close for December.