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‘Let industry heal itself’

The FSA has been warned to focus on the essentials of mortgage regulation and “park the bright, expensive ideas for later”.

At the Association of Mortgage Intermediaries’ annual dinner in London last week, director general Chris Cummings urged the FSA not to introduce any new initiatives as he said the market could not cope with them at the moment.

He said: “Regulation must be accountable and must not become a barrier to the mortgage market healing itself and a return to confidence.

“So, please, FSA, no new initiatives. We could not cope with them. No new TCF grand plans – certainly not without a thorough cost-benefit analysis. Perhaps most of all, consider your role in helping free up the lending market.”

Cummings said he is concerned that the desire to see banks build up their capital positions is being taken too far.

He said: “Prudential regulation may protect lenders and regulators from another embarrassment but it can be yet another factor which freezes the market and frozen liquidity makes for a frosty time ahead. In trying to stop banking failures, I think the FSA risks bringing about a mortgage market failure and it will be consumers who lose out.”

On the issue of dual-pricing by lenders, Cummings said the AMI will be issuing a member briefing following a series of constructive meetings with the FSA. He pointed out that despite dual-pricing, the number of mortgages bought through the intermediary channel has increased.

He said: “It seems that this attempt to ‘sweat the assets’ of the branches has actually proven just one thing – in difficult times, consumers want and seek out professional mortgage advice.”

Cummings told lenders that this is the time to move away from favouring branch-based pricing and start focusing on consumer-based pricing.


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Guide: 10 required letters — what to send, to whom and when?

This guide from Johnson Fleming will take you through the required communication and also give ideas for additional actions that will ensure your auto-enrolment project is a success. The topics in this guide include: the letters you need to send out; what to send and when; the importance of employee engagement; and what to consider as additional communication.


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