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HBOS sees loan share dive to 7%

HBOS’s share of net mortgage lending plummeted to 7 per cent for the first half of this year, with profits tumbling by 56 per cent from £2.139bn to £950m.

This comes after Abbey revealed a 26 per cent share of net mortgage lending in the first six months.

HBOS held 22 per cent of the net lending market in the last six months of 2007. Its slump to 7 per cent sees it return to the low levels of the first half of 2007 when a new pricing strategy for retention business backfired, leaving it with a net lending share of 8 per cent.

The banking giant says it still has a 20 per cent share of gross mortgage lending.

The Mortgage Practitioner sole trader Danny Lovey says: “HBOS is probably going to be around fifth in terms of new business for the first half of this year.”

HBOS mortgages in arrears for three months or more rose to 1.95 per cent from 1.67 per cent at the end of 2007.

Mortgages in arrears in its specialist lending business increased to 3.27 per cent from 2.59 per cent.

HBOS chief executive Andy Hornby says: “We remain cautious on the outlook for global wholesale funding markets and do not expect any significant reopening of securitisation markets in 2008 or the first half of 2009.”

Personal Touch Financial Services sales director Dev Malle says: “HBOS took a clear strategy to step out of the market this year, with BM Solutions still sitting back from the market. At the same time, rival lenders such as Abbey have been a lot more aggressive, so I am not surprised at all.”

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