Lenders show signs of life and death By Sarah Davidson


march was a busy month for lenders across the board with some announcing positive moves for the broker market while others cast a shadow over the intermediary out- look. Lloyds Banking group’s cheltenham & gloucester pulled out of the intermedi- ary market as part of LBg’s “ongoing” rationalisation of its brands and the group axed a further 570 jobs. all Lloyds Bdms were forced to reapply for their jobs for the fourth time in seven years and staff morale was rumoured to be low as a result. the group also announced


further “alignment” of criteria across its brands resulting in Halifax’s maximum loan to value on interest-only mort- gages being cut from 85%


Trading standards


by


Robert Sinclair director AMI


the coalition government will now survive the sum- mer and its next big test will be the party confer- ence season as the Liberal democrats contemplate electoral oblivion at the may elections. the mortgage market is being tested too. as the big lenders are already discovering, their plans to do more direct business via branches are founder- ing and they are looking at how the intermediary


to 75%. northern rock also delivered a blow when it an- nounced it would axe a fur- ther 680 jobs by the end of the year in a move to improve profitability and help it return to private ownership.


Buy-to-let boost Both Skipton and metrobank announced entries into the buy-to-let market, boost- ing lender competition in the sector further. Skipton’s range of products went live in march while metrobank said it planned to launch around Q3 2011. rumours continue about the entry of Yorkshire Building Society, Santander and Whiteaway Laidlaw Bank into the buy-to-let sector later this year (see CFI: News Review, p52). aldermore added an-


route can and will do more. consumers continue to vote with their feet and look for choice and advice. europe, the Financial Services authority and lenders would do well to acknowledge the true value of this to the consumer. We continue to wait for clarity on a timetable from the FSa for the mortgage market review and i remain concerned that despite not seeing final rules, some in the regulator think it right to begin to apply some of the proposed changes ahead of the process being concluded. running ahead of the game is what all good busi- nesses do but it takes an outstanding regulator to do this well. History tells us this may not be the case.


other pinch of positivity for brokers as it increased the maximum number of proper- ties it will accept on residen- tial buy-to-let mortgage ap- plications from two to three, subject to a total exposure of £1m. the intermediary market


had a boost on the residen- tial side as well as cambridge announced growth plans for 2011 with all additional lend- ing done via brokers. it plans to lend more than £200m this year in cambridgeshire and the east anglia region and has linked with Legal & general. meanwhile norwich & Pe- terborough was locked in res- cue talks with Yorkshire BS for a likely merger deal that looks set to be announced in april. n&P later suffered


they continue to deny they are ahead of the game although i keep being told of examples. the fear of retribution on firms by the FSa in going public makes even my task difficult. the FSa should be concerned about this breaking of part- nership. unemployment and infla- tion continue to operate to expectations while gross domestic Product and growth constitute the dan- ger point. all those rushing to talk up rates may be left with egg on their faces. i can still see as many reasons to not raise rates as to support an increase. the property market and price fluctua- tions are now as regional and even local as at any time in the last twenty years. the decision to refer the


a downgrade by ratings agency moody’s following its agreement to pay £57m of compensation for 3,200 Key- data investors contributing to a pre-tax loss of £48.9m in 2010, compared with a pre-tax profit of £900,000 for 2009. elsewhere abbey for inter- mediaries was rumoured to have overtaken Lloyds Bank- ing group in terms of the vol- ume of intermediary lending done in 2010. ray Boulger, senior techni-


cal manager at John charcol, said: “it is clear both lenders are close in terms of mar- ket share so it would not be surprising if Santander had overtaken Lloyds group, but the difference would not be much more than a percent- age point.”


mortgage Brain trigoldcrys- tal deal to the competition commission was interest- ing. apparently the deal worked for the parties but the costs of the review were such that the deal has now foundered.


Whether both parties can survive independently will also be interesting. What is clear is that the money running round this part of the value chain is not working. We need a rethink on sourcing, search- ing, application and record keeping. the fear of unfettered price rises drove the refer- ral. However the cost per transaction is actually very small. Perhaps this is an- other market where service and quality could be more important than price.


mortgage introducer APRIL 2011 5


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