The Interview


more innovation in that area but we are already able to help customers whose income is less easy to prove than via a payslip for example.” The radical changes Finlay thinks


may potentially be ahead centre around this key perspective. Currently British consumers are among the least loyal in retail banking in Europe. We have our current accounts with one bank, our savings with another, a credit card with a third and more often than not, our mortgage with a fourth. But Finlay says this may be about to


change, particularly for borrowers who want to take out a mortgage but who do not fall into mainstream vanilla mortgage criteria. “Having access to the borrower’s


current account and savings behaviour allows the lender to be much more informed about the customer,” he explains. “We really only have a splintered market with customers using lots of different banks because that’s the market we’ve created. I can potentially see that changing.” But how does the broker fit into that


new dynamic, I counter? If customers have to use the same lender as they hold their current account with, where does advice come in? And where is the repeat business for intermediaries? “All products all channels,” says Finlay.


“If a customer sits down in front of a broker and says I’m a Barclays current account holder that gives the broker the opportunity to access the PAML number from Barclays and that’s sufficient affordability checking for us. We don’t need any other income verification. That’s a channel there – it’s just how we interact with it.”


AdvIce Is sTIll The key FInlAy sAys “If I want to buy a piece of kit from the


high street, do I go into one shop and pick up that one piece of kit from that one shop? The answer is no. I would probably explore the internet, look at the various options and I may then go into a high street store that has lots of pieces of kit for me to look at. Then I’ll take some advice and then buy the piece of kit that I want. “That’s what the intermediaries do. They


offer that breadth and depth of advice which is why I think there will always be a strong intermediated mortgage market.”


The credIT gAme “Computer says no” has become a stock phrase in the mortgage market of late with brokers tearing their hair out as one customer is accepted and another practically identical customer is shown the door. But Finlay says credit scoring is here to stay. “Dare I say it,” he says, “credit scoring


is our business. Banking is about risk management. It’s about us putting in place what we believe is the right level of risk for the level of lending we want to do. If you consider why we got through the crisis it’s because we’ve done that well.” That’s where the broker can add value


though he insists. “The government and the FSA talk


to us about being not only responsible lenders but also about affordable lending and affordable borrowing. A direct result of that is that there have to be some rules and regulations. And each lender will be different,” he says. “Because the broker knows the whole market, he or she can fit that profile against a lender that works.”


cold comForT? Finlay does reaffirm Barclays’ commitment to the intermediary sector through this period and expects the lender to hold onto its 8% market share this year, with roughly half of mortgage business coming via brokers. “We are making sure that we continue to develop the business,” he maintains. “But I think if the market booms or we try to go too quickly, it won’t help anyone.” On the bright side, he is positive about


opportunities for innovation. “We’re looking to be innovative on the


product side and we are in the process of designing various products to bring out later this year,” he says. He’s keeping his cards close to his


chest though. “I can’t reveal any details about those products but I think if you look at what we’ve done in the past with things like offset where we’re now probably the number one provider of that product in the UK, I think we may look to reinvigorate that to keep it alive.”


30 morTgage inTroducer SEPTEMBER 2010


The Woolwich also recently launched


a 90% loan to value mortgage with Bovis Homes, which Finlay says is the sort of innovation he’s looking to recreate. “I think we’ll see more things like that


coming from us in the future and we’ll look to keep that sector of the market innovated,” he says. “Assessing the risk on new build properties, even at a high LTV, comes down to sitting down with the builder and discussing what they want to do and why.”


supermArkeT sweep Finlay also has some interesting thoughts on the rise of the moneysupermarket. coms and confused.coms of this world. “Technology will clearly change what


that market looks like over the next four or five years,” he says. “I think the aggregator sites will become stronger and that will change the mortgage market model. “How that market changes for


brokers really comes down to consumer behaviour. Consumers are going straight to the internet for information, they’re probably slightly more risk averse and slightly less trusting now. They’ll rely upon themselves and their knowledge gathering themselves a lot more. And I genuinely believe they will go to the internet to gather that information. “But when they’re thinking about


purchasing a mortgage, which is one of the most significant purchases you make in your lifetime, I do think they’ll still want to talk to someone. So I think we’ll see more of the aggregators gathering information and then farming customers to brokers for that face to face contact.” Finlay’s advice to intermediaries is to


embrace this change rather than railing against it. “Brokers should get on board with


aggregators and I would be very surprised if the majority of advisers aren’t having conversations with aggregator sites to see how they can work together going forward.” It’s the future he says.


FlAT As A pAncAke Expectations for the future are an important part of developing a business strategy, and Finlay is keen to remain cautious in his outlook. Though this year


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