View more on these topics

In the Marketplace

Chris Duncan

Bradford & Bingley commercial director Ian Darby is starting to relax after overseeing the £10m transition of B&B&#39s branches into independent advice centres.

The Marketplace at Bradford & Bingley launched two weeks ago supported by an intensive marketing campaign poking fun at the lack of product choice available from other providers.

Darby, clearly relieved the launch has gone to plan, predicts The Marketplace will process £5bn-worth of mortgage applications by the end of the year. As the former managing director of Charcol, acquired by B&B last February, Darby played a pivotal role in shaping The Marketplace project from its inception.

Although B&B already had one foot in the mortgage broking market through estate-agency chain Black Horse Agencies, Darby says the move to independent mortgage broking was still a tall order.

He says: “It was a substantial task but B&B had long been committed to this strategy and Charcol helped to accelerate the process. My job was to make sure that all our customer propositions could stand up to a new brand launch.”

Darby is quick to play down rumours that Charcol could be rebranded under the The Marketplace banner.

He says: “Never say never but there are no plans to rebrand Charcol. It is just not our intention. Charcol and The Marketplace are being run as separate brands because they appeal to different areas of the market.”

Charcol will continue to chase midto high-net-worth clients through its 11 bran- ches and over the internet, which Darby says will explode in popularity over the next few years. With only a tiny branch network, Charcol has to look online for its main source of revenue.

Darby estimates around 20 per cent of mortgage borrowers research loans online and then go to an IFA for help. Darby says these are the kind of borrowers The Marketplace is targeting.

“The internet case is now clearly established. There is a huge demand for online mortgages services. From the group&#39s perspective, it is critical that we win that game,” he says.

Ever tightening margins and cut-throat competition in the mortgage market has prompted small and medium-sized lenders to offer the products of rival lenders.

West Bromwich Building Society has a panel of providers whose products are sold through the society&#39s branches and Newcastle Building Society acts an agent for sub-prime lender Kensington.

B&B currently has 37 lenders on its panel and offers a range of first-time-buyer mortgages under the B&B brand.

Darby sees the move as a test case for lenders looking for new ways to wring a profit out of a market which is bleeding itself dry.

He says: “If margins continue to be squeezed, many in the industry will be interested in how we get on, from the stockmarket to our competition. I am sure that B&B will not be on its own for long in doing this although the barriers for entry are prohibitive, with training, equipment, technical support, product development and online capability all essential.”

Charcol clearly played a key role in this respect for B&B but Darby believes it depends on a lender&#39s strategy as to whether it is better to buy an established IFA or start from scratch.

A major advantage of acquiring a national IFA is the buying power which comes with it. B&B will be responsible for product procurement for both brands but can rely on the financial muscle of Charcol.

Darby says: “Charcol had big purchasing power but now the group can go into bat with the collective buying power of both brands to ensure we can offer the best rates.”

Charcol also influenced B&B&#39s decision to equalise commission for its advi-sers, perhaps the one hint of controversy surrounding its move into independent mortgage broking.

Although the bank&#39s advisers are paid the same regardless of what product they sell, the existing terms of remuneration between B&B and its providers remains the same.

But Darby points out that Charcol capped commission rates and procuration fees for its advisers six years ago and views the move at B&B as a natural progression.

He says: “There has been research to suggest there exists some commission bias among IFAs. Even though there is no evidence of this at B&B, we thought it was obvious to eliminate any potential bias and make the change anyway.”


F&C Ventures bought out by management

Foreign & Colonial&#39s private equity arm F&C Ventures has been bought by its management for an undisclosed fee.The operation, which has funds under management of about £500m, will be renamed Graphite Capital.The buyout follows Hypover- einsbank&#39s sale of its 90 per cent stake in Foreign & Colonial earlier this year.The firm manages six funds, of […]

Stakeholder support pack for IFAs and employers

Scottish Equitable says product providers must give IFAs more support to help employers meet the October stakeholder deadline.It says the pressure is on providers to support IFAs and their corporate clients fully in meeting the deadline with only six months to go.ScotEq points to research carried out by consultant actuaries Punter Southall & Co which […]

The lone arranger

The mortgage market is still in the midst of a fierce battle and a further cut in interest rates has only served to heighten the competitive mood.The major players are jock-eying for position and assuming very different tactics but it was Nationwide&#39s radical stance which triggered the battle.CML communications manager Bernard Clarke says the focus […]

More than two-thirds of homeowners expect to profit from buoyant market

Rocketing numbers of UK homeowners view the buoyant housing market as a way of making a profit, according to Britannia Building Society.Results from its homeowners confidence survey reveal the number of people who believe it possible to make short-term profits from owning a house has shot up to 69 per cent from 44 per cent […]


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 thought leadership.

    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