This month, we are talking to Sidney Wager (pictured), head of intermediary market development at Barclays.

 

How did you get started in the mortgage industry? Why would you recommend the industry to others?

Having joined such a large institution, I initially worked in a range of roles within Barclays that offered different directions and scope.

I was running the largest and most valuable internal channel region when the opportunity arose to move into the intermediary space. I was content where I was at that time, but the pull of being tasked with helping to transform the direction of our intermediary-facing business and the amount of untapped potential on offer was an opportunity that does not come along too often. It was impossible to turn down.

The thing that really attracted me to the intermediary market was how fast-paced it is in terms of its volatility, unpredictability, and the intensity of the competition. And these factors still represent why I would recommend the industry to others who are ready to embrace the challenges and opportunities on offer rather than being fazed by them.

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The mortgage market has started to improve in the first few months of the year. Where does Barclays see opportunities for growth, and are there areas that it is looking to expand in?

It is always positive to see improvement in the market and we are emerging from a period where some challenging conditions forced us to think differently as a business and look deeper into where the opportunities for growth and improvement lie.

By this, I mean areas such as ESG and the green agenda through to intergenerational lending. It could also be through changes in criteria, internal processes and how you present yourself as a business.

Growth is not always about looking for the ‘shiny new toy’, it also comes through improving on the things you already do well, and in cementing improvements where they may not have been so strong previously. We are simultaneously setting out to do both and the last year has afforded us the time and opportunity to rethink this.

Is the current mortgage market the new norm or is it a short-term phase?

If I could answer that with any genuine certainty, then I would be a very wealthy man.

The first thing to address is that I am not sure we even know what the word “normal” actually means anymore, following the unprecedented events over the last few years. Previously, there was a good chance that you could predict the future based on the past, but today’s market is far more situational, and we have to adjust accordingly. Strategic agility is key and the ability to move quickly in step with market conditions and consumer behaviour is paramount to success.

Fortunately, we operate in a highly reactive industry that has become accustomed to change and, generally speaking, I think it is one that has coped incredibly well with some significant ups and downs. And this resilience should provide plenty of encouragement for what the short-, medium-, or longer-term future looks like.

Product transfers (PTs) are an increasingly important part of the business. Given the higher numbers of these deals brought back into the lender, what is your view on higher PT fees/parity with new business fees?

There is more to the lender/broker relationship than just fees. It incorporates the whole ecosystem, from submission to completion and everything in between, including the quality of our business development manager (BDM) team, who we consider to be best in class.

We fully understand the importance and value offered by our intermediary partners and this is a symbiotic relationship. However, margins have been reduced across the industry and we have to be careful about how we manage these and where and how any additional costs are attributed.

The reality is that we are a commercial entity who is fully accountable to our shareholders and stakeholders. As such, we will continue to review all elements of the business, but rest assured that we always aim to do the right thing for our intermediary partners, shareholders, stakeholders, and borrowers.

How does Barclays intend to keep the broker relationship strong?

During the past 12-18 months, we have invested a huge amount of time and money into improving the end-to-end experience for our intermediary partners and their clients. This has meant prioritising the time spent with the broker community to gain a stronger understanding of their businesses, how they interacted with us, where we were succeeding and where we have opportunities. This led to the #YouSaidWeDid campaign you may have seen across some of our social media platforms, where we have responded to feedback from our partners.

We’ve also begun the process of rebuilding our mortgage application systems, a move that represents a significant investment for the business and demonstrates our commitment to the intermediary market. This digital transformation will involve ongoing development and I’m sure this will prove to be an eye-opening experience from a service and delivery perspective for everyone involved.

In the current market conditions, it’s all about taking a step back – where possible – to implement positive change and better position ourselves as a business to successfully face the challenges and optimise opportunities as they arise.

We will continue to engage across all elements of the market including network and clubs, trade bodies and broker firms as the key will be to maintain and encourage a healthy respect, even where there may be slightly conflicting priorities. Great industries work through this partnership model and thrive – this is us.

The Mortgage Charter was a huge undertaking by lenders and the government to support customers. What has the impact of it been so far at Barclays and has it changed internal processes a lot?

The Mortgage Charter is a great initiative that demonstrates just how quickly the industry can come together to provide flexibility to help customers adjust to changes in their finances. It showed agile thinking, a real recognition of the economic climate and a genuine understanding of the difficulties being faced by some customers.

The short time frames involved tested us as a business, but we feel we are in a better place because of it.

Through the charter, we have supported circa 12,000 customers. As the interest rate environment stabilises, we are seeing demand now decreasing month-on-month, with the majority of those coming to the end of the temporary support returning to full payments.

Consumer Duty is another big thing that has come up in the past year. What impact has it had on Barclays and the sector more widely, and do you think it is a positive for the sector?

Anything that benefits the end customer and creates equitable outcomes should certainly be viewed as a positive development.

The key thing about Consumer Duty is the fact that it has made all businesses re-assess how they are being run in their entirety. From a Barclays perspective, it has certainly helped us develop a far more rigorous commercial approach and in terms of how we service a range of customer needs.

It encouraged looking at customer impacts across the whole supply chain and the full customer experience, where collaboration between lenders and partners is even more paramount if we are to succeed in achieving those good customer outcomes and avoiding the foreseeable harms.

Within Barclays, a great deal of focus continues to be placed on carrying out fair-value assessments of our products and our product information templates to ensure our intermediary partners can fully understand the characteristics of the product or service and the identified target market.

This means the inclusion of greater consideration to the needs, characteristics, and objectives of any customers with characteristics of vulnerability. There is also a much more determined emphasis on identifying the intended distribution strategy and ensuring that the product or service will be distributed in accordance with the target market.

It’s been hugely encouraging to see so many areas come together, both from an internal and external perspective, across the whole customer journey, with working with a common focus clearly in mind can only be a positive going forward in delivering better outcomes and avoiding potential harms for our customers.

 

Barclays completed the acquisition of Kensington Mortgages in 2023. How is it progressing, and do you think other high street lenders may acquire specialist lenders?

The acquisition presented an exciting opportunity to broaden Barclays Bank UK’s existing mortgage product range by adding a best-in-class specialist mortgage lender with an established track record in the UK market, further enhancing our capabilities to deliver next-generation, digitised consumer financial services.

Since its completion, there have been clear benefits for both parties, and this represents an excellent example of two major brands working closely to extend their propositions to a wider range of individuals across the UK.

Although, it’s not for me to say if this type of acquisition strategy would be the right path for other lenders, as this will depend on a huge number of key factors.

You are a great supporter of the Diversity and Inclusivity Finance Forum (DIFF), and diversity and inclusion (D&I) in the industry more generally. Do you think the industry is making enough progress, and what would you like to see in an ideal world?

As an industry, I think it’s fair to say that – despite significant progress being made – we are still not as diverse or inclusive as we could or should be and this progress must be tempered with the knowledge that there is still some way to go.

The work of IMLA, AMI, DIFF and Accrue – to name but a few – is trailblazing in terms of asking the tough questions and putting the mirror up. However, this is not a tick-box exercise, it’s a movement that should be embedded within company cultures for several reasons.

We need to acknowledge and be cognisant of the fact that the DEI conversation covers several genres. It covers sexuality, it’s gender, it’s disabilities, it’s neurodiversity, it’s ethnicity. It comes in various shapes and guises.

It’s great to see that the right conversations are being had, curiosity levels have certainly been raised and the realisation of the need for change is evident, but I remain incredibly impatient.

The ideal world has diverse representation at all levels and mirrors the society and communities within which we all serve. This would not be the ongoing conversation it currently is.

If only we could suspend reality and get back to being 3-4 years old when there is precious little bias, that would be ideal, but sadly, we don’t live in an ideal world.