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‘Non-conform woes will worsen’

The downturn in the non-conforming mortgage market is likely to worsen this year, according to ratings agency Standard & Poor’s.

The chief concerns lie in the increasing number of sub-prime borrowers in arrears, along with rising interest rates and weakening macro-economic conditions which are contributing to huge losses. S&P says this is resulting in more lenders dipping into their reserves to balance their books.

The Council of Mortgage Lenders said last month says it expects repossession figures to soar from just over 10,000 last year to 15,000 this year because of sub-prime growth.

The Standard & Poor’s report says: “Over the past year, we have seen the first chinks in the armour of the non-conforming market. Arrears and repossession levels continue to rise. We exp- ect to see an increase in los- ses in the second half of the year, with the possibility of more reserve draws in the near future.”

Alexander Hall chief operating officer Andy Pratt says: “Sub-prime lenders are taking cases with greater cre- dit problems. If there is a recession, some will struggle to survive.

“As a largely prime bro- ker, we are dealing with more clients with credit problems than 18 months ago because prime lenders are offering prime deals to borrowers with small credit problems. This means that sub-prime lenders are tak- ing cases with greater credit problems.”


NU to slash 4,000 jobs by 2007

Norwich Union will announce 4,000 job losses across its UK operations by the end of 2007.Around half of these will be in the form of compulsory redundancies, with about 1,000 support roles being offshored to India and 500 IT roles outsourced to third party suppliers.Following a review of its businesses, NU says it is hoping […]

Barcode slashes re-reg time

Cofunds is offering a new set of IFA tools which it says will significantly speed up the consolidation of client assets on to the platform and eliminate admin errors from the process. The new tools will allow bigger IFAs to move client assets in bulk using prepopulated data forms. Once the client signs the forms, […]

Riley email barrage hits IFAs

Scottish Life has apologised after bombarding over 100 IFA firms with thousands of copies of an email, leaving several advisers’ email systems crippled. CBK principal Peter Chadborn says he got over 2,000 emails containing information on Scottish Life’s new investment bond Riley which clogged up the firm’s system. The Colchester branch of CBK had to […]


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