Q1 The Irish property market has taken a real pummeling, suffering a worse crash than the UK. Has it bottomed out yet?
This year brings similar challenges to 2009, with the number of housing transactions in Northern Ireland remaining low compared to historical levels, but we are confident that we can continue to provide mortgages for local homebuyers. Despite the significant improvements in housing affordability over the last couple of years, demand for mortgages has been more subdued in recent months. Clearly, last week’s Spending Review announcement is a likely factor impacting on sentiment in the market and the subsequent delivery of public expenditure cuts is the most significant headwind facing the consumer and Northern Ireland economy as a whole.
Q2 What state is the Northern Irish broker market in, how many intermediaries are there in the region and what predictions do you have for the market?
Like most areas of the UK, the broker market in Northern Ireland has had its challenges to face and has needed to adapt and deal with tough economic conditions. Many of the brokers I’ve spoken to have had to make difficult decisions to ensure survival and in many cases have changed their business model completely. Around 560 intermediary firms in Northern Ireland are currently registered with the FSA. In terms of business writers, while numbers have dropped, there are approximately 1000 individuals across the province who, while recognising the tough market conditions, remain upbeat about the future as clients continue to seek advice for their financial needs.
Q3 Is Ulster Bank’s distribution limited to Northern Ireland? How different is this market to the Republic of Ireland?
Currently, Ulster Bank intermediary mortgage products are only available in Northern Ireland to brokers and clients in BT postcodes. We have a very simple product range where rates and fees are equitable across purchase and remortgage deals and all products are priced the same across both our broker and branch distribution channels. The market in the Republic of Ireland is markedly different to that in Northern Ireland with differing regulators, legal systems and currencies. Following the global banking crisis and recessions across many European economies, the mortgage and housing market has seen significant impacts across both the Republic of Ireland and Northern Ireland with further challenges still to be addressed in the near future.
Q4 Ulster Bank announced £500m of funding in March 2010 – how much of this has already gone, what’s left and how much business has gone through the broker market?
In March this year, we announced a new £500m mortgage fund, intended to support all kinds of homebuyers over the next 12 months, including first time buyers, movers, and those wishing to remortgage. We have been pleased to date with the level of lending through this fund. We have reduced some of our mortgage rates to further encourage new business, and we are committed to measures and innovations to support local homebuyers.
Q5 How are you fostering relationships with the broker market and with the property market predicted to fall further, how much appetite to lend does Ulster Bank really have?
Broker distribution in Northern Ireland is largely made up from the biggest AR networks and DA clubs from across the UK – Legal & General, Sesame/PMS, Openwork, Personal Touch and First Complete to name a few have strong membership across the province. My previous role at NatWest Intermediary Solutions allowed regular contact with the senior teams across most distributors. I intend to build on these close relationships to grow the Ulster Bank Intermediary business profile and to deliver opportunities for our distributor partners. From my early experience, and since Ulster Bank’s return to the intermediary market following a period of absence, our distributor partners enjoy a good working relationship with Ulster Bank Intermediaries. The introduction of the Momentum Mortgage and support of the Co-Ownership scheme has helped build and develop strong relationships with brokers. Support and help for the first time buyer market has been extremely positive and demonstrates Ulster Bank’s ambition of becoming Ireland’s most helpful bank. Ulster Bank remains committed to the mortgage market in Northern Ireland and will continue to develop new and innovative products and propositions to meet customer needs.
Q6 You’ve had 21 years experience with Royal Bank of Scotland, Ulster Bank’s parent group. What lessons did you learn at RBS that are likely to stand you in good stead for the interesting times ahead?
The one constant throughout my career with RBS that remains to this day and has been exacerbated over the last 18 months is the need to embrace and manage change. The UK economy, financial service industry and mortgage market has seen almost unprecedented change and the impact has been far reaching across individuals business and personal lives. Ignoring or disbelieving the need for this is not an option. Facing these changing times, with a robust plan to manage and the ability to deal with the challenges that arise, and choosing a positive attitude of perseverance, has helped me navigate through these times. Looking to the future and the challenging times ahead, maintaining consistent, regular and clear lines of communication with our brokers and customers will be vital to ensure we meet their needs in this ever changing environment.
