someone and before I do I need to know that money will come back to me in the next 25 years. It’s a forward looking assessment,” explains Laing.


Other bugbears include first-time buyers failing credit scores because they’ve not built up a credit history by using credit and paying it off every month. Savings similarly are sometimes completely eradicated from the score accuse brokers but they show financial sense on the part of the borrower. “We rate people based on how we know them,” says Laing. “It’s not news that building a relationship with a bank and giving them a line of sight into your financial behaviour will help you when you come to get a mortgage or access credit.” The problem is not credit scoring asserts Laing, it is a changing and tightening attitude to risk.


“If my mission is to lend to as many people as possible who will be good for the money while lending to as few people as possible who will have an accident along the way, then on track record, there is no better tool than credit score cards,” he says.


Rather than trying to work the system by joining the electoral role or building up a good credit history, Laing says brokers should consider the risk a borrower represents to the lender. “Usually borrowers will be able to get a mortgage but it will be at a lower LTV or on capital repayment terms instead of interest-only for example,” he says. “I’m sure part of the frustration with brokers is that they haven’t really had to deal with credit policy before because in the past even pricing didn’t vary that much up to 90% loan to values. These days it tiers all the way up from 60% LTVs.” Mathewson is keen to combat this frustration. “There is a communication challenge where credit scoring is concerned. I think lenders need to communicate to brokers how the richer more risk-oriented market Iain’s talking about operates,” he says.


“I think we’ve been rightly criticised in the past for getting that communication wrong and we’ve been working very hard on getting it right over the past year.”


IT’s good To Talk As the new kid on the block, Mathewson


has been keen to engage with intermediaries and find out what they want from AfI.


“I think we can differentiate on service and we’re aware there’s work we can do to improve that,” he says. “Our model has been through quite a lot of change recently but brokers are constantly telling me that how easy you are to do business with is what sets you apart.”


He may only have been in the job since


May, but already Mathewson has had an impact on how AfI does business with intermediaries. “We’ve launched a service recovery service team so if there’s an issue either the BDM or telephone BDM will have direct contact with brokers and can escalate that issue,” he says. “And we’ve introduced a senior underwriter contact programme to improve to try and get problems solved faster.”


Paperwork has also been an issue for the bank in the past but Mathewson has made progress on cutting the red tape for brokers.


“Rather than asking for twenty basic items via fax from brokers, we’ll now take a lot of that over the phone,” he explains. “We’ve also taken out a lot of the documentation out that wasn’t necessary. We’re trying to make life easier for the intermediary.”


So far so good but Mathewson says it


doesn’t stop there. “We’re now looking at improving our


broker platform. We are talking to brokers about what they want from the technology we use to interact with them,” he says. The lender is already investing time and money in understanding how best to serve the intermediary market – something Mathewson says demonstrates AfI’s commitment to the broker market. Harking back to the importance of risk at Santander, another of Mathewson’s reforms at AfI has been the establishment of a risk and service committee. “We set up the new forum to meet once a fortnight to discuss the key issues in risk and service and price. It’s part of a drive towards making sure we’re constantly addressing problem areas and working to improve our service,” he explains. Mathewson is confident that AfI can compete in this market.


“I think the biggest differentiator for us is that we’re always there,” he says. “You can’t say that about everyone in the market. Our objective is to be top three on price in the market and we’re succeeding – we’ve got more best buy mentions than any other bank.”


For a bank that has only been in the UK since 2005, it’s not bad. Before their acquisition of Abbey, Santander was heavily into the Latin American and Spanish markets. “This is a totally different market for Santander,” says Mathewson. “But as a bank they have a fantastic record of adapting to each country they go into.” The difference Mathewson is referring


to relates partly to the profligate nature of British consumers when they bank. We don’t have our mortgages, savings, current account, credit card and investments with one bank. We shop around.


At the heart of Santander is the concept that it wants deep relationships with its customers. “That’s much harder to make work in the UK than in Spain or South America,” says Laing.


Many of the big banks have made


efforts to curb this profligacy in UK consumers by offering incentives for taking out more than one product from them. “Santander already has offerings for


current account holders that are stronger than those for new customers,” says Mathewson. “We’re working hard at making those available through all our channels. I suspect the market will keep on down the path of trying to build rewards for customers who stay loyal and build a deep relationship.”


FlaT lInIng One of the reasons the market looks like it will move in this direction is down to its size. There are already fewer lenders dominating the market. Figures from the Council of Mortgage Lenders showed that in 2009 some 82.5% of all new lending was done by five lenders and only one was a building society. “Banks generally are competing harder


for retail deposits which is sucking money out of the building societies,” says Laing. “To get to between £200 billion and £250 billion gross lending, which is


mortgage introducer NOVEMBER 2010 37


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56