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It is a tad ironic that at the time when any self-respecting fund manager should be watching his or her children windsurf at Rock or sipping pastis in a boulevard cafe in San Rafael, news by the bucketful descends upon the financial community with the interim reporting season setting off in earnest. The mortgage banks are usually first in the queue and this year they seem to be speaking with one voice. Sadly, analysts are uniform in their dismissive approach to this group of companies.

The likes of Abbey National, Alliance & Leicester and Halifax have had a tough old time of it of late. Bank shares have underperformed the FTSE 100, itself delivering scarcelystellar returns since the beginning of the year. Interest rates may have been rising but they remain low in the context of the last quarter-century while rising competition for mortgage business is shredding margins. This is a market which, with the best will in the world, is pretty mature. We have a high level of homeownership compared with continental Europe and, even if family units are becoming smaller in size, there is a limit to how much bigger the market can become. No wonder analysts have been almost bearish on this sector for some while.

The results delivered thus far have all been towards the top end of expectations. A buoyant economy and savage cost-cutting have helped but the fundamentals look as challenging as ever. You can understand why the likes of Abbey National are seeking to break into the small business market, where the old big four high-street names — Barclays, Lloyds, HSBC (Midland) and RBS (Natwest) – have a stranglehold. To think it was the lack of commercial lending, with its attendant credit risk, that made the building societies look so attractive when they elected to turn into banks.

With the growth of personal wealth expected to continue at a high level, acquiring funds under management through offering innovative personal finance products remains an attractive option for this part of the financial community. It is no wonder that Equitable Life is so much in demand. Surprising, too, the Halifax has ruled itself out of the running. Few in the IFA sector will mourn the passing of a mutual dedicated to direct selling and taking a rather “holier than thou” approach to business generation. The windfalls promise to be meagre although the level of interest could deliver some surprises on the upside.

Upside is where we need surprises in this stockmarket. We need to post a rally of at least 10 per cent if we are not to end the year lower than we began. My friends at Aberdeen Asset Management are generally optimistic. They are experiencing a steady and broadening flow of money into their funds, suggesting the savings message has struck home. They believe this is to be an industrywide experience, which will accentuate the attractiveness of asset management businesses. How foolish of me. I should have tackled them on their prognostications for the demutualisation of Scottish Provident. Now, that is a situation where I have more than a passing interest.

The City get-together which aimed to celebrate the life and passing of Peter Hall was no sombre affair, as befits a financial services professional who lived life to the full, despite severe underlying medical problems. Stories abounded – fishing, drinking, jokes – with only a tinge of sadness for those who acknowledged he had failed to make his half century and would have had more to contribute. Peter worked for a number of leading investment management houses, notably Save & Prosper and Baring, before electing to do his own thing – a brave decision in an industry with a notoriously short memory. There were enough of his friends present last Friday to show that individuals, at least, remember longer. And collectively we celebrated his memory to the full.

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