Northern Rock has a record as a canny mortgage lender, but not afraid to back an aggressive idea. Eyebrows were raised a while back when it pioneered a package linking a conventional mortgage secured on somebody's home with an unsecured consumer loan - at the same rate of interest.
It was intended for first-time buyers, who often start out with a 95 per cent mortgage. The unsecured loan often took the total borrowed to more than 100 per cent of the value of the property. Rival lenders sucked their teeth. A formula for disaster, they said, luring hard-pressed first-timers into more debt than they can afford.
Not a bit, Northern Rock retorted. Home-buyers often borrow unsecured money when, for instance, they set up house, to pay the solicitor, or buy furniture.
Why leave their business to another lender? Northern Rock preferred to make unsecured loans to people it knew, who had already qualified for the mortgage, rather than to someone who happened to have walked into a car show-room. It could make money by charging an extra quarter point for the whole mortgage.
So it turned out. Arrears on unsecured loans in these "Together" packages consistently run lower than on Northern Rock's stand alone consumer loans, indeed a little better than those on secured mortgages across the industry.
Until now, though, Northern Rock has steered clear of the booming market in socalled "sub-prime" mortgages - lent to people with a blot on their credit history. Nor has it touched "self-certified" loans to people whose earnings have to be taken on trust, or the "near" category, who narrowly miss qualifying for a conventional mortgages.
These all command higher interest rates to reflect higher risk. But in today's low-interest environment plenty of people can afford premium rates. The success of Kensington, a mortgage lender specialising in such mortgages, has shown it is a sizeable and valuable market.
Northern Rock was among the organisations that was missing the custom of people with good jobs who suffered some personal of financial mishap in the past which disqualifies them from a conventional mortgage.
They do represent a greater risk - earlier this month Kensington reported that its bad debts have more than doubled this year.
Then yesterday Northern Rock announced plans for a partnership with the American investment bank Lehman Brothers, whereby it will find the borrowers and set up the mortgages in return for a fee income from Lehman.
But the loans will never been on its balance sheet - it will not take the credit risk. Nor will it administer them once they are in place.
But can Northern Rock escape the risk to its reputation? Suppose Lehman comes down heavily on people who miss just one or two monthly payments. Some sub-prime lenders are accused of charging usurious penalty rates the m oment anything goes wrong.
Who will bitter home-buyers blame then? Faceless Americans in the City? Or the respected Geordie household name that sold the project to them?