View more on these topics

Ready for action

Abbey National&#39s decision to take a stake in mortgage platform

IFonline sets it apart from competitors Halifax and Nationwide which

have sided with rival platform Mortgage Brain.

The move also surprised some industry sources who say Abbey had vowed

to concentrate on developing its own broker site rather than invest

in external technology.

But Abbey head of e-commerce Neville Sharman denies that its own

internet service for intermediaries will be neglected. He says: “We

have spent £35m on our introducer internet and that has been

successful – it has done £6bn of business between launch in

October 2000 and the end of last year.”

Abbey has remained tight-lipped about the scale of the investment in

IFonline but industry sources believe it has around 10 per cent of

the total shareholding.

Abbey says this shareholding will benefit brokers by letting them

accept online mortgage applications using IFonline technology while

continuing to trade through its own intermediary website.

Explaining Abbey&#39s choice of platform, Sharman says they considered

the option of going with Mortgage Brain but were not convinced by its

technology. But Sharman does not stop there. He says Mortgage Brain

is “a very small company with a small growth pattern. We looked at

how to put it online but it would have been at a great cost and would

favour Halifax.”

He says the decision to reject Mortgage Brain is partly as a result

of listening to intermediaries&#39 gripes with the platform. Sharman

claims the biggest issue for intermediaries was that a limited number

of lenders were set to control the platform, restricting the

flexibility of the service on offer.

Intermediaries, he says, are concerned about Mortgage Brain&#39s

ambition to become the single platform, fearing it would create the

threat of a cartel of providers controlling prices.

Sharman also points to doubts over Mortgage Brain&#39s ability to meet

the higher compliance standards required from brokers as new

regulation is introduced by the FSA.

Partly based on these comments from brokers, Abbey says it opted for

IFonline, which it claims has superior technology because it is

primarily a software company.

It says IFonline and Abbey are also well geared up for the “son of

CP98″ and the implications of the FSA regulating advice from 2004 in

terms of increased compliance.

Sharman says: “There will be quite a few changes so we are working to

improve the compliance shield part of IFonline and will be actively

marketing the solution in the marketplace.”

Abbey says its own online services have been well received and over

half of its business is done through intermediaries, above the

industry average of 25 per cent.

At the same time as putting a lot of weight behind technology for

brokers, it is striving to reposition itself in the marketplace and

to take on the big four of banking – HSBC, Barclays, NatWest and

Lloyds TSB.

Abbey is currently seen as primarily a mortgage bank with about a 10

per cent share of the mortgage market, which it says puts it on a par

with Halifax. But this year it is on a marketing drive to promote a

wider range of services.

This month, it launched a new business banking account. On the

current account side, it is investing £25m in a bid to entice

800,000 customers to move from their existing banks by the end of

2003 and is recruiting another 500 staff.

A change of image is on the way. Abbey is building up to what it says

is a major brand relaunch later in the year in a bid to be seen as a

retail brand rather than an “old school bank”. This will include a

new ad campaign featuring real customers recruited from talent shows

to be held across the UK this month.

Group marketing manager Kieran Hartigan says: “We are using real-life

customers to act as brand ambassadors on the back of the interest in

reality TV.”

Hartigan denies that this repositioning will put its mortgage

business on the back-burner, saying: “The mortgage market is a very

important one and we plan to build on it. The market remains positive

and broader economic issues like interest rates dropping have helped


Looking at niche mortgage markets, Abbey says it is in a good

position as one of the few UK lenders to have launched a euro

mortgage product. To date, this has had limited appeal as it is only

available to people being paid in euros and living in the UK but,

depending on the political climate, it says it is in a position to


It looks like Abbey is keen to pull itself into the 21st century with

its investment in marketing and technology for the public and


With the mortgage industry about to be hit by massive regulatory

change, the impact of its strategy of diversification and commitment

to IFonline is sure to become clear.


Home is where the CGT is

Harvey lives in the Middle East and is planning to retire in the UKfairly shortly. He is over 65. He has a property in London which hasa substantial capital gain on it,along with a portfolio of offshorefunds that has also substantial accrued gains.He is anxious to consider what might be done before returning to theUK. […]

NU takes 20% stakeholder share

Norwich Union claims it is now the leading provider of stakeholderpensions after taking a 20 per cent market share and sales of£119.1m in the eight months since the launch of the product.The company, which saw its new life and pension business shoot up by30 per cent last year to £1.3bn in equivalent premium incomefrom £976m, […]

A consumer&#39s view

The outcry following the FSA&#39s proposal to scrap polarisation is notgoing to go away and quite right, too. It is hard to see how such amove could benefit consumers in the long term.The proposed changes to allow multi-ties and compel IFAs who want toretain true independence to charge fees owe less to any concern forconsumers […]

Outside edge

Behind the headlines of the recent CP121 from the FSA, there is muchto consider. Although most of the initial debate centred on the depthof life office pockets and the likely rush to buy/secure distribution(delete according to your view), there is a whole raft of otherissues that require consideration.I am particularly interested in the impact of […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm