Britain's "bad bank" that is running down the loans of two bailed-out lenders said on Tuesday it repaid 1.9 billion pounds ($2.9 billion) to the government in the first six months of 2013.UK Asset Resolution (UKAR), a state-run 'zombie bank' that does not take on new business, said it has now returned 6.6 billion pounds to the government. It owed 48.7 billion pounds when it was created in October 2010.UKAR, Britain's sixth largest mortgage lender, is winding down the loans of Northern Rock and Bradford & Bingley, two of Britain's customer-owned building societies which were nationalized in the run-up to the 2008 financial crisis.Chief Executive Richard Banks said he still expects the process of repayment to take a decade but UKAR will continue to make regular repayments to the Treasury and taxpayers should get all their money back.The government is set to receive a windfall of 400 million pounds from UKAR after the bank announced last month it had agreed to sell a portfolio of former Northern Rock loans to U.S. private equity firm J.C. Flowers and debt recovery business Marlin Financial.The impact of that sale will be shown in UKAR's full-year results.Banks said there were no other sales on the horizon but UKAR was "actively looking for transactions all the time" and there were buyers in the market for such deals."But the important thing is we're not going to give them away, we're not going to sell them cheaply," Banks added.UKAR's first-half underlying profit before tax rose by almost 10 percent to 528.8 million pounds in 2013 from 481.4 million pounds a year earlier, as the number of its accounts in arrears fell.Mortgage accounts three or more months in arrears, including possessions, dropped 17 percent to 21,332 since the start of 2013.Banks said this was partly down to a modest economic recovery in Britain that was helping to boost the value of mortgage assets, but said household finances remained under pressure.