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RBS says intermediaries second to direct channel

Royal Bank of Scotland says it is committed to its intermediary channel after admitting it comes second on its priority list to branch-based business.

After making the revelation in its interim results, RBS insists that revamped broker channel RBS Intermediary Partners, which launched in February, is in good health and remains a core part of its business.

RBS argues that the reason its direct channel has taken priority is that some lenders have been pricing at a loss in 2006 and RBSIP did not want to get involved in a price war for broker business.

RBS marketing director for consumer finance Ian Stuttard says: “The emphasis has been greater on the direct side but in no way is it suggesting that we are not interested in the intermediary market. From mid-January through to mid-May, the intermediary market was extremely aggressive.

“In that time, HBOS were pricing at 30-35 basis points below the cost of funds. We have seen recent evidence that HBOS has pulled back and we have been prepared to participate more.”

Stuttard admits that RBSIP has experienced service problems since launch but says it is improving the broker experience.

He says it is also committed to setting up an online facility early next year.

Stuttard says: “We have some service issues on RBS purchase business and we have been open with brokers and have asked them to bear with us. If you do not have online capability, then you will always be at a disadvantage.”

Alexander Hall chief operating officer Andy Pratt says: “RBS was very aggressive in launching RBSIP. Maybe those expectations were too high.”


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