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L&G Mortgage Club facilitates £73bn of mortgage lending

  • 06/03/2019
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L&G Mortgage Club facilitates £73bn of mortgage lending
Legal & General Mortgage Club has seen a significant uplift in mortgage lending completed by its affiliated advisers for the second consecutive year.


The club has grown its lending facilitated by £20bn over the last two years, completing £73bn of mortgages in 2018, up 12 per cent from £65bn in 2017, which itself was up from £53bn in 2016.

Of the £72.9bn total, £59.9bn was non-retention with £13.0bn as product transfers – a 82 per cent to 18 percent split.

“We are transforming the housing ecosystem through our unique understanding of the industry as the largest participant in the intermediated mortgage market in the UK,” L&G said.

It highlighted technology development in the mortgage club with its SmartrCriteria and ClubHub software, and investment in the Smartr365 broking platform.


Equity release lending up

As part of Legal & General Group’s annual results there was also growth for its later-life lending, housebuilding, protection insurance and general insurance businesses.

The Home Finance arm, which lends within the equity release and later-life sector, completed £1.2bn of lending in 2018 – up 19 per cent from the £1bn total in 2017.

L&G estimated it had a 30 per cent market share last year.

It said the flexible drawdown product, which allows homeowners to keep loan to value ratios lower by only drawing the loan when needed, had helped to broadly double sales volumes since its full introduction in 2017.

“We anticipate total lifetime mortgage volumes of over £6bn by 2020, up from £3.9bn transacted in 2018,” it added.


Built 2,500 homes

In housing, L&G Capital’s housing businesses sold or completed for rental around 2,500 homes in 2018 and the firm said it would continue to grow its multi-tenure business across build-to-rent, build-to-sell, later living and affordable housing.

It took over full ownership of Cala Homes in March 2018, and with this increased house building capacity said it was “positioned well for further growth”.

Legal & General Surveying Services delivered 539,000 surveys and valuations last year.

“The traditional home buyers survey has been rebuilt for the digital world and has launched as SmartrSurvey, which is sold via business partners and directly to consumers,” L&G added.


Insurance premiums up

UK retail protection gross written premium income (GWP) increased 4 per cent to £1.28bn, up from £1.23bn in 2017 with new business annual premiums up to £175m from £172m.

“In H2 we expanded our partnership with Barclays launching a new non-advised proposition for family protection in addition to renewing the existing advised mortgage protection offering,” L&G said.

Meanwhile in general insurance, GWP was up 11 per cent overall on 2017 with growth across the range of channels and products.

This included three distribution agreements for its household insurance business which will be supported by its digital SmartQuote and SmartClaim propositions.


Profit up 10%

Overall, the L&G group saw operating profit rise 10 per cent to £1.9bn, up from £1.72bn in 2017.

It completed £10bn in annuity sales – £9.1bn in pension risk transfer sales and £800m of individual annuity sales. These were up from £3.9bn and £671m each respectively.

Group chief executive Nigel Wilson noted the business had been resilient and performed strongly despite 2018’s political uncertainty, asset market declines and slowing economic growth.

“We became the UK’s first £1trn investment manager, executed a record £9bn of pension risk transfer deals and invested billions in the UK’s future infrastructure and cities,” he said.

“Our strategy positions us well despite the broader environment, our current trading is strong and we expect this momentum to continue in 2019,” he added.


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