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Nationwide to bring in intermediary brands

Nationwide Building Society is likely to launch a multi-brand intermediary mortgage arm similar to HBOS and Royal Bank of Scotland after announcing its planned merger with Portman.

The merger, which will be finalised in September 2007, will see the combined society, to be headed by Nationwide finance director Graham Beale, become the second-biggest mortgage lender in the UK and give it a platform to launch an assault on HBOS’s market dominance.

The Portman deal will see Nationwide moving deeper into the sub-prime market due to Portman’s presence in the light-to-medium adverse sector, which it says will make it the fourth-biggest specialist lender. But it is cautious about Portman’s equity-release offering as Nationwide is concerned that the sector could be open to misselling claims.

Nationwide’s self-cert, buy-to-let and light-adverse specialist lender UCB and Portman’s intermediary arm, The Mortgage Works, are likely to be retained.

Nationwide, which said in April that it plans to increase the volume of its intermediary business from 65 per cent to over 70 per cent, has not ruled out adding brands to differentiate its intermediary products.

It also plans to upgrade its trading platform for brokers early next year but will assess TMW’s system first.

Beale says: “It is a fair working assumption to suggest that we are heading towards multiple brands for intermediaries but things can change in a year. We are moving into sub-prime but not the heavy end, as we are turning away too much business.

“Our caution on equity-release remains and we do not want to be open to misselling claims so we may dampen down the Portman offering”

Portman chief executive Robert Sharpe says: “There are some strong precedents to support brands in the intermediary arena as you can have different pricing and different products.”

Pink Home Loans managing director Tony Jones, who worked at Nationwide for 23 years until 2002, says: “It gives Nationwide a lot more clout and they are up there with the big boys.”

Merger details, p3

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