View more on these topics

B&B rescue deal – first industry reaction

The mortgage industry has reacted to the Bradford & Bingley part-nationalisation, blaming the move on mistakes made a over decade ago.

Wriglesworth consultancy managing director John Wriglesworth, who worked at Bradford & Bingley in the 1990s, says mistakes were made in strategy in 1995 and 1996. He believes that it was too late for chief executive Steven Crawshaw, who stepped down earlier this year, to make a difference. He argues that in the 1990s the then building society chief executive Christopher Rodrigues made a grave error when he shifted away from prime mortgage lending to focus on specialist lending and financial advice.

Those years saw B&B develop its self cert and buy-to-let businesses under the MortgageExpress brand. But deals were also struck with GMAC to further build up the mortgage book. Wriglesworth says it is now clear that that those mortgages both those originated by B&B and GMAC were not of sufficient quality.

The group also bought John Charcol and IFA businesses which where then sold when Crawshaw took over.

Wriglesworth says: “They brought in the Marketplace at Bradford & Bingley to give independent advice on mortgages when most of its customers didn’t know it was a bank let alone a broker.”

“Steven Crawshaw was right to sell the advice businesses because they weren’t making any money. But he was far too late to change other things. The writing was already on the wall when it abandoned prime traditional mortgages for self cert and buy to let.”

Mortgageforce chief executive Rob Clifford says he is sentimental about the B&B brand both in terms of what it means for brokers and for consumers.

He says: “MortgageExpress was the broker’s friend. We have worked closely with Bradford & Bingley over the last few years and B&B had a positive consumer brand. It is very disappointing to see it go. However you can’t criticise the Government. It has been far more decisive than over Northern Rock and has to be the right thing for consumer confidence. But from a mortgage market point of view it is very disappointing.”

Stroud & Swindon sales and marketing director Linda Will says: “The key thing in this is that the FSA pre-empted the action. This is going to improve confidence in the regulator.”


Joined at the IP

How can we get more clients to take out income protection? One would be hard pushed to find an IFA who does not believe in the benefits of IP but it is not hard to find an adviser who struggles to sell it. Poor awareness, complicated processes, high rates and the complexities of products and underwriting all result in low numbers of sales.

Reactivated debate

The debate between active and passive management has a long history but recent turmoil in financial markets has tested the merits of both strategies to their limits.

Crunch time for small funds?

Nearly 500 UK retail funds are running with less than £10m in assets, research from Money Marketing has found. The survey, in conjunction with Financial Express, raises questions over how profitable it is for fund firms at a time when the credit crunch is pushing profit margins to the limit.

Policy decision

If I was one of the 140,000 employees of HBOS and Lloyds TSB, I would go and buy whatever forms of income and payment protection insurance those banks offer as soon as possible.

Neptune’s Burnett looks beyond Greece

Watch Rob Burnett, manager of the Neptune European Opportunities Fund, discuss the Greek bailout deal and its potential implications for European equities. In the video Rob discusses: Why, with the Greek crisis receding, markets can now focus on Europe’s strong fundamentals The resilience of European markets and why the recovery is on a solid footing […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm