Tesco on track for 2011 launch into mortgages
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Supermarket giant Tesco has revealed a pre-tax profit of £3.8bn today and says it is well placed to launch its mortgage proposition this year.
The supermarket says its Core Tier 1 capital ratio has risen substantially – to15.9% at the year-end.
It says its growth in the Bank’s deposit base means that it has a significant excess of deposits over loans, as it builds its balance sheet capacity ahead of its planned launch into mortgages, planned for this summer.
In its results it says: “The range of products available for customers will be broadened further this year with the planned launch of mortgages.”
A spokeswoman for Tesco Bank, says: “We can confirm that our plans are on track and subject to regulatory approval we anticipate launching mortgages this summer.”
Tesco revealed its plans to launch into mortgages in April 2010 and joined the Council of Mortgage Lenders as an associate member in November 2010.
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Readers' comments (11)
dave | 19 Apr 2011 11:16 am
Join this queue for a mortgage!
The FSA has been banging on about increasing standards and forcing brokers to take on compliant procedures that are so time-consuming and costly that their individual businesses are at risk, then they allow a supermarket (stack 'em high, sell 'em cheap!) to offer mortgages in among the cabbages and beans!
You couldn't make it up!
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steve mcgill | 19 Apr 2011 11:22 am
They're aiming for world domination
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Anonymous | 19 Apr 2011 11:26 am
The trouble is that they will almost certainly do well in this market as they have the money to throw at TV advertising campaigns etc, even if their products are not the best on the market.
I wonder how many reward points you'll get with a 5 year fixed rate ?
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Neil Bellamy | 19 Apr 2011 11:27 am
Great to see a new entrant to the UK mortgage market! Shame it is an over powerful supermarket - they may well take over the world in due course. It would be better to see a number of credit unions, and new buildings societies emerge instead. Oh there really is not any profit in that for greedy investors though...
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Ancient Wisdom...is a mortgage broker in N3 | 19 Apr 2011 11:29 am
..imagine the points on a £420k mortgage! - and buy everything inside the house from Tesco as well!!! - (oh, dont forget insurance and add delivery to the list!)
...Direct only lender of course too?
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AA | 19 Apr 2011 11:31 am
Good to see Tesco in the mortgage market direct or indirect. I presume they will dip their toes in the market first.
There needs to be alot more competition especially with the top banks dominating. Lets hope tesco offer higher ltv sooner rather than later and put pressure on the rest.
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Mark | 19 Apr 2011 11:39 am
So Tesco are going to offer Mortgages?
I can't put it better tha this:
Isaiah 32:11-11 (King James Version):
look it up
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Bob Donaldson | 19 Apr 2011 11:56 am
You guys should remember the new players that came into the markets in the 80s. The Mortgage Corporation and all the rest that followed. Where are they now?
Let them take a slice of the market if it allows first time buyers to get in so be it!
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martin tapper | 19 Apr 2011 12:01 pm
Buy One Get One Free!
Or some loss leading specials to get clients through the door?
Brilliant - I will have one...
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Stuart Dunn | 19 Apr 2011 3:44 pm
It will be interesting to see how Tesco adapt their advice process and whether they adopt some of the processes and systems of the fee free brokerage L&C they have been promoting at the counter for several years. My guess is a valuerange of direct products for FTB and then the 'Taste the difference' remortgage range boxed for issue on an information only basis. Who knows, one day you will simply be able to purchase a mortgage off the shelf with a use by date and quality guarantee and we can all go stacking shelves. Decline in advice standards? 'Every Little Helps'
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