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Prudential&#39s Malone warns on execution only loans

Prudential national mortgage club manager John Malone has hit out at

execution-only mortgage services such as that offered by Hargreaves

Lansdown, claiming there are hidden dangers for consumers choosing

such a route.

Malone argues that advice is vital in all mortgage deals to avoid

clients focusing solely on the best up-front rate and missing out on

other benefits that lenders build into their products to help people

manage their total finances, as with offset mortgages.

He says clients will need even more face-to-face advice to help them

overcome endowment shortfalls.

Malone is also concerned about a possible long-term consequence of

the Hargreaves Lansdown service, which rebates part of the

procuration fee back to clients going execution-only, is that small

brokers will be unable to compete and be driven out of the market.

“To squeeze out thousands of small intermediaries due to the

execution-only route will in the end impact on the products and

product design that the marketing departments of innovative lenders

have created,” he says.

Hargreaves head of mortgages Ian Jordan says: “Execution-only advice

has been around for all sorts of financial products. You cannot force

people to take advice. We are more than happy to provide advice where

it is wanted.”

•Mortgage Brief, p64


Big bonuses for Standard Life bosses despite losses

Standard Life is paying directors big bonuses and pensions despitestockmarket losses and pulling out the stops to clear regulatorysolvency hurdles.The mutual is awarding performance-related bonuses to directors.Chief executive Iain Lumsden was paid £743,000 last year. Thisincludes salary of £467,000, £16,000 benefits includingcar, £136,000 performance-related bonus and £124,000 as thecashable part of a long-term incentive. He […]

Legg Mason replaces Johnston as lead manager on UK emerging fund

Legg Mason Investors has replaced John Johnston as lead manager ofits ailing UK emerging growth fund in a bid to boost its flaggingperformance.Johnston took over the fund in October 2000 after leaving MurrayJohnstone, where he ran a smaller companies Oeic and two investmenttrusts. He was expected to reverse the fund&#39s underperformance butinstead it has plummeted […]


“Yes. Until the FSA clears up the definitions of misselling and sortsits problems out with the underwriters, what are we meant to do?”Stuart Feast, Feast Noble & Co “No. I would not be com-fortable with continuing, even with thewaiver. You could be open to future claims. Any IFAs who takes it isstark raving mad.”John Ryan, […]

Safety stays an obsession with quality bonds

Credit Suisse Asset Management says the market&#39s view that manyhigh-yield bonds will be imminently re-rated is wrong but saysobsession with safety is likely to persist.Kevin Adams, manager of CSAM&#39s corporate bond monthly income fund,says that, despite widespread views to the contrary, the market&#39sfixation with safety will continue as economic fundamentals in the UKshow no sign […]

US loan growth is not painting a pretty picture for the US economy

Written by Mike Riddell One of the current big debates in global financial markets is whether investors should believe ‘hard’ rather than ‘soft’ data, where the usually reliable business and consumer surveys have been suggesting strengthening in global growth momentum for some time now, while the economic data that feeds through into the Gross Domestic […]


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