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Nationwide eyes sale of £2.7bn commercial property arm

(c) Sky News 2017: <a href="">Nationwide eyes sale of £2.7bn commercial property arm</a>

Britain's biggest building society is weighing the sale of a portfolio of commercial property loans worth nearly £3bn months after announcing it would stop lending to the sector.

Sky News has learnt that Nationwide has begun discreetly sounding out potential buyers of the loans after its new boss decided that the commercial property sector ‎was not part of its "core purpose".

The portfolio has a value of about £2.7bn, representing a tiny fraction of Nationwide's vast balance sheet.

Sources said that a sale was not certain to go ahead and that Joe Garner, who took over as its chief executive last year, could instead decide to continue running off the commercial property book.

Advisers have yet to be formally appointed to handle the process.

Nationwide, whose marketing slogan "proud to be different" underlines its efforts to distinguish itself from the UK's high street banks, reported a fall in half-year profits‎ to £615m last November.

Nevertheless, the reporting period‎ was the third-most profitable in the mutual's history.

Mr Garner said at the time: ‎"Despite recent economic uncertainty Nationwide has continued to serve the needs of its members."

The move to vacate the commercial real estate business reflects a desire to focus on less risky‎ lending as financial institutions continue to face pressure from low interest rates.

Potential bidders for the portfolio would include financial investors and other lenders, sources said.