Shawbrook’s Ray Wong joins Paragon as relationship director
Wong joins from Shawbrook where he worked for two and a half years, most recently as relationship director.
He has also held banking and property roles at The Ingenious Group, Secure Trust Bank, Natwest and Santander over the past 14 years.
At Paragon, Wong’s remit will cover the Midlands, London and South East. His appointment also takes Paragon’s relationship director team to 13, supported by 16 portfolio managers.
Wong (pictured) said: “I’m excited to join Paragon from Shawbrook, the company is building a fantastic reputation in the development finance market for delivery and has recorded strong growth in the past three years.
“I’m joining an experienced relationship director team and I’m looking forward to hitting the ground running and supporting new and existing clients.”
Robert Orr, Paragon Development Finance managing director, added: “Ray has enjoyed a strong period at Shawbrook, so we are pleased to have recruited somebody with his experience and sector expertise. He will complement our existing relationship director team and I’m confident will be a great success.”
More awareness towards complex credit options is needed – Gee
Close to our industry ‘home’ we’ve seen the final throes of the stamp duty holiday – partial in nature for the last few months and ultimately only available in England. It delivered at most a £2,500 saving, which undoubtedly helped some, but would have been a minimal driving force for housing transactions, particularly in the last four to six weeks of it.
Many have welcomed the return to ‘normality’, and it’s true that we are now getting a much better idea of the medium to longer-term future for the UK housing market because the holiday has fully ended.
The second deadline to be hit and passed was that of the furlough scheme and this clearly has the potential to have a much more sizeable impact for many more people and businesses, albeit in the context that the numbers on furlough have been dropping consistently for some months.
At the end of June, there were fewer than two million people on the furlough scheme. Now there are none, but we await to see how many of those individuals will be returning to their old – or new – jobs.
There will be people who unfortunately do not have a job to go back to, and it’s also clear the pandemic has had an impact on the finances of many people. The good news however is that the worst predictions of what Covid might unleash on the economy appear not to have been met.
Financial impact on tenants
Foundation carried out a survey focused on the housing aspirations of both existing homeowners and renters. It was encouraging to learn the vast majority of people had not experienced any negative financial impacts as a result of the pandemic, although self-employed people were three times as likely as employed individuals to have taken out a government grant or business loan.
And the further good news is that very few people say they have been declined for a mortgage, in-store finance, an unsecured personal loan, or a credit or store card when they applied for them.
The importance of access to finance and credit can’t be underestimated.
Lenders want to lend, have the funds to do so, and are actively looking at borrowers who might traditionally have been under-served.
What we can inform and educate borrowers and potential borrowers more on, is their increased ability to access mortgage finance, even if they have credit issues or are concerned about their finances during or post-pandemic.
Almost one in four say they’re worried about being approved for a mortgage in the future, citing concerns such as a poor credit history or score and a low or unstable income as the top worries.
Options are available
However, the availability of mortgages for those who might not have a clean credit score or have recent credit blips has grown considerably. We should know, as we’ve been offering these mortgages for some time, and there is a flexibility in terms of accepting multiple incomes or other types of income that might not have been there the last time the borrower sought a mortgage.
Or they simply might not be aware of these product options, if they’ve never secured a mortgage before.
So, there is clearly a need to keep banging the drum about specialist lending options and what is achievable for all types of borrowers, especially after a period when some borrowers might be worried about the impact on their finances and how this might be perceived by a lender.
We certainly don’t want prospective customers to think that a mortgage can’t be secured, especially when their product choice has grown considerably.
Octopus Real Estate and Homes England create £175m green lending partnership
As part of the Greener Homes Alliance with Octopus, Homes England will provide £46m of the £175m of loan finance.
The alliance will provide loans of between £1m and £20m to finance new SME development projects.
Loans are capped at 85 per cent Loan to Cost or 70 per cent Loan to Gross Development Value.
Homes funded must achieve a minimum Energy Performance Certificate (EPC) rating of B and will benefit from increasing interest rate margin discounts as the energy efficiency of the homes increases above this, measured using the Standard Assessment Procedure.
Homes achieving an EPC rating of A will benefit from interest rate margin discounts of two per cent.
The alliance will support the construction of up to 750 new homes whilst also equipping SME housebuilders with knowledge and expertise around low carbon construction.
Before starting their developments, SMEs will benefit from free of charge advice from sustainability consultants McBains and Octopus Energy.
McBains will provide design guidance and practical steps to achieve an improved EPC.
Housing Minister Christopher Pincher MP said: “Our Future Homes Standard will ensure that from 2025 new homes produce at least 75 per cent lower CO2 emissions and be future-proofed with low carbon heating.
“This partnership will help reach our targets for cleaner, greener homes for future generations.”
Andy Scott, head of residential development at Octopus Real Estate, said: “Although green credentials may be an aspiration for most developers, sometimes access to funding, costs and education can stand in the way of these aspirations. The alliance will offer tangible discounts which can help fund the costs to support the delivery of green developments, plus access to advice and education, which will enable SME housebuilders to deliver future proof, energy efficient homes to be enjoyed for generations to come.”
Finance 4 Business shareholder restructure confirms Martin as chairman
Finance 4 Business provides specialist mortgages, bridging finance and development finance.
Pinnington joined the business in 2017 and took over as CEO in March 2021 to work alongside Johnson, who has worked at Finance 4 Business since 2010, and Atkinson, who joined in 2013 to lead the business.
New chairman Russell Martin said: “Finance 4 Business was my original baby and I’m proud of what I have achieved over the years in helping to make it the business it is today. But it’s time to fully hand the reins to David, Melanie and Paul, who have been a major ingredient in the recipe for success and will continue to drive the business forward, catering for a market evolving at pace.”
Russell added: “It’s been a momentous year for us, with the launch of the ARMCO Group, and we feel this has significantly enhanced our offering and contributed to our success. This, combined with the expertise and experience of Melanie and Paul, means that we have a strong team to drive the business forward. We will continue our mission to help investors, developers and businesses capitalise on the opportunities that are emerging in the property market.”
The company has also rebranded across the website and other business channels, including social media.
Russell added: “Despite entering a new era here at Finance 4 Business, we will continue to play a central role as a broker, unravelling complex and multifaceted information with clarity, knowledge and speed, via a dedicated and experienced team.”
Data-led FCA will be more selective, direct and difficult – Sinclair
Speaking at The British Specialist Lending Senate, Sinclair (pictured) said eight executive directors have joined the Financial Conduct Authority (FCA) over the past two years who have a “different philosophy, brief and way of thinking” about industry regulation.
Its data-led approach, meant the regulator would be asking for more “granular detail” from lenders and brokers, not just about what a firm has sold but their financial position.
There will be an increased focus on a firm’s capital, liabilities and business management which will be predominantly based on data rather than personal consultations.
Sinclair said that the FCA would use this data to “analyse, scrutinise and work out where the outliers are”. Outlier firms, explained Sinclair, are those that fall outside the normal area of the regulator’s bell curve during data analysis.
From a broking perspective, directly authorised firms would have to hold more capital and there would be a greater focus on financial resilience.
Lenders will need to provide more clarity on the type of business they wanted and were prepared to accept, and it would become more important for them to “stick to it”.
He added that the authorisation process would be tougher and it would be “exceptionally hard” for firms wanting to switch business.
“The [FCA] will use all this data to analyse, scrutinise and work out where the outliers are,” he said.
Sinclair added that while the regulator would be “more selective and more direct and more difficult”, this should not be feared.
“If you’re doing the right thing in the right way for the right reasons, there’s nothing to be scared of,” he said.
Hampshire Trust Bank to acquire Wesleyan Bank
Matthew Wyles, chief executive of HTB, will remain CEO of the combined business while HTB’s Tim Blackwell will continue as Chief Financial Officer. Some 115 employees of Wesleyan Bank will be transferred and continue to work from Wesleyan Bank’s existing offices.
Wesleyan Bank is part of Wesleyan Group and offers a range of banking services including mortgages, savings and deposits. It also offers commercial loans to small businesses and professional services.
Wyles said: “HTB’s growth strategy has always included an intention to supplement our development through acquisition when the right opportunity presented itself. We are very pleased to have agreed this deal with Wesleyan Assurance Society and we are excited about the added scale and momentum which this transaction will bring to HTB’s existing dynamic franchise.”
Mario Mazzocchi, group chief executive of Wesleyan, said seeking new ownership for the bank made strategic sense, as the growth potential moved away from the group’s core business.
He added: “Wesleyan Bank has been enjoying considerable success in recent years as it focuses on supporting its professional and SME customers with medium-term asset finance and longer-term secured loans.
“Following a strategic review, we found the growth opportunities ahead of the bank were different to those of our core business, which will continue to focus on the specialist financial needs of doctors, dentists and teachers.”
Shawbrook Bank completes £343m BTL securitisation of TML loans
It is the third securitisation that the bank has completed in the last two and a half years. It consists of 2,352 BTL mortgages, secured against properties in England, Wales and Scotland.
It is the second securitsation of BTL mortgages originated by The Mortgage Lender (TML) and will support the group’s “growth objectives, funding strategy and capital management” according to the London Stock Exchange (LSE).
Shawbrook Bank purchased a minority share in TML in 2018 before fully acquiring it earlier this year.
Around £301m of class A notes were priced at 65 basis points above Sonia and were distributed via Lloyds Bank, Bank of America and Barclays. The LSE update added that the margin on these notes is on a par with the lowest margin achieved on a UK BTL transaction since the global financial crisis.
Shawbrook Bank’s chief financial officer Dylan Minto (pictured) said the transaction was a “testament to the strength of business and the markets that we’re in”.
He added: “We want to be able to allow TML to go and really write into that opportunity, and at the same time whilst the wholesale market has such an insatiable appetite for AAA notes, we can give it to them.”
He said Shawbrook Bank had an “absolute desire” to complete further securitisations, and suggested that “you can expect to see a couple a year from here on in”.
Minto said the bank was “really excited” about the BTL and first charge complex markets that TML operated in.
He said: “There is an emerging mega trend in in the post-Covid world whereby you have lots of borrowers who, by sheer bad luck, whose incomes have been impacted by the pandemic.
“It’s through no fault of their own that they work in hospitality or hotels and restaurants, and they will find themselves in a difficult position, whether it is because they took payment holidays or got into arrears on their mortgage, or on their borrowings.”
Minto said that as banks applied “straightforward credit underwriting scorecards” people impacted may not be able to access the main mortgage market.
He added: “We want to expand our range of first charge complex to the most pandemic-affected individuals because it’s a huge market that won’t be well served by the big banks and we can really provide proposition and product into those markets to help people.”
Minto said that last year, the securitisation market was “choppier” from April to around July and “not very active”.
He said the pandemic didn’t impede Shawbrook however, as it had access to retail deposits, and the “sheer amount of flow in the retail deposit market was phenomenal”.
“There was a point last year where we were carrying £2.5bn of cash on a balance sheet of £8bn. It was so liquid out there,” he added.
He said that with regards to TML and Bluestone Mortgages, which it is a funding partner of, Shawbrook told the lenders at the height of the pandemic to “get out there and support more borrowers… because others can’t or won’t at that point in time”.
Minto said he also expected the securitisation market to pick up in the near future.
He said: “Those that are wholly reliant on wholesale markets, the non-bank lenders, should now start to be able to position their assets and go to the wholesale securitisation markets. They have got equally good assets, and it’s right for them to now come to market a little bit more activity.”
Minto said: “The well-established players who’ve got banks behind them… they’re seeing in the last year a collapse in the cost of retail deposits and that is giving fuel to be able to access these markets. Pricing is attractive to us, but it is under some competitive tension, so the borrower is getting a better deal today than he or she was yesterday.”
Magnet expands underwriting and operations team
Field boasts notable property experience, having initially qualified as a property solicitor at a large international law firm before holding a host of roles within the real estate businesses. These include heading up the in-house legal team at Regent Property Management. She had been working as an operations consultant at Magnet since April.
Magnet Capital has reported seeing sharp growth since the reopening of the property market following the initial lockdown last year, with both its new business and enquiry levels up year-on-year. The lender said all of its loans which were started before 2020 have been redeemed, with a high level of repeat business from borrowers, some of whom are now onto their fourth loan with Magnet.
Sam Howard (pictured), managing director at Magnet, said the recruitment of Field underlined the lender’s belief in hiring only “the brightest and best” in order to provide a first class service.
Howard continued: “We understand how much value our borrower and broker partners place on Magnet Capital’s deep industry knowhow, expertise in the property sector and the team’s ability to act as a finance partner. Deborah’s experience will bring an additional skill set and complement the existing operations team.”
YBS Commercial hires Wales and South West relationship director
She was most recently a business development manager at Barclays for a year and before that was a business manager at the bank. She has worked in financial services for over 15 years.
She will work with the Wales and South West team, including relationship directors Sue Lewis and James Roche as well as relationship managers Seren Moyle and Molly McCleary.
She will be based at the lender’s Cardiff office but will work from home for the foreseeable future.
Allan Griffiths, regional director for YBS Commercial Mortgages in Wales and the South West, said: “I’m delighted to welcome Kayleigh to the team. I’m really looking forward to her contribution, and I have no doubt that she will bring a wealth of value to the team.”
Parry said: “I’m thrilled to be joining the YBS team for the Wales and South West region in supporting its ambitious growth strategy. YBS Commercial is on an exciting journey and I’m looking forward to meeting the needs of our broker partners and borrowers in my new role.”
Commercial property broker Alastair Hoyne launches Finanze
The company is headed by Alastair Hoyne (pictured) who aims to provide a bespoke service to clients seeking bridging, development finance, buy-to-let and commercial mortgages.
Hoyne joined the property sector in 2005 and moved to Hong Kong in 2009 to establish Candid Properties, an online estate agency which charged its clients zero commission.
He later sold the business and moved into investment banking and fund management until 2013. Hoyne then set up a consulting firm, helping firms scale and raise funds particularly in private equity real estate.
With Finanze, Hoyne will charge a £199 application fee and 0.5 per cent of the gross loan upon received a full mortgage or loan offer post-valuation.
Due to his relationship with Connect IFA as well as short and long-term lenders, Hoyne said he would be able to “provide a significant range of products and negotiate terms” according to client circumstances.
Hoyne said: “Every customer is unique, they each deserve their own bespoke solution, not just an off-the-peg database driven response.
“I focus on building lifelong relationships with customers, becoming a trusted part of their property ‘power team’, adding value in the decision-making process throughout the property lifecycle.”