A MENTALLY ill woman who allegedly murdered a one eyed alcoholic by setting fire to him, told neighbours there was no problem, the Old Bailey has heard.

Patricia Malcolm, 53, of Stanstead Road, Catford, is charged with the murder of Frank Hancock.

The prosecution alleges she poured a flammable liquid on Mr Hancock, 63, before setting him on fire in his flat in Pattenden Road, Catford, on February 4 last year.

Today (September 19), the court heard that the couple who lived in the flat above Mr Hancock's left to go shopping at around 11am.

As soon as they returned at around 4.30pm they could smell burning and see smoke and they could see a woman standing in the hallway of Mr Hancock's flat, reading a letter.

Prosecutor David Fisher said: "They both asked her 'is your house on fire? Have you called the police?', and she replied, 'no it's not on fire, there is no problem'."

The court heard that Malcolm told the officers who arrested her after the fire that she knew Mr Hancock.

She also showed them a burn on her arm and told them a builder had done it to her earlier in the day.

She admitted going to see Mr Hancock that day, but said that when she arrived she a saw a builder leaving the property in quite a hurry.

Malcolm also told officers that she and Mr Hancock had argued and that she saw an electric blanket smoking on the floor in the kitchen.

She said the last she saw of Mr Hancock was him sitting on the chair in the kitchen smoking, and then she left.

The trial continues.