Infinity and FML seek new funding

20 August 2007

Infinity Mortgages says it is in talks with a number of financial institutions regarding setting up alternative funding lines after Investec was unable to guarantee it funding going forward.

Earlier today Infinity informed the market that due to uncertainty over funding it is unable to honour applications that have not yet had offers issued.

Infinity, which is independent but gets 100% of its funding from Investec, now hopes to be back in the market within two to four weeks.

Matt Gilmour, chief executive at Infinity, says that while funding is uncertain it is unable to risk making offers to pipeline applications.

But he says Infinity's return to the market is a case of “when not if”.

He adds: "We still have a strong relationship with Investec and are in negotiations about designing a new product range.

"We are also in discussions with a number of financial institutions with balance sheets that are keen to work with us.

"In two to four weeks we will have something back on the market, but what it will look like and who it is funded by, I don't yet know.

"Our finger is in the air at the moment."

Despite the crisis, Gilmour says Infinity will do everything in its power to protect staff jobs.

He says: "We will come through the storm stronger, bigger and better but we need a full workforce to make that happen."

FML, which is funded by Infinity, has confirmed that it will not be able to honour applications not yet offered.

It is also seeking alternative funding.

Paul Brett, founder of FML, says he has already had conversations with potential alternative funders in order to return to the market as soon as possible.

Brett says: “We are loyal to Infinity but if it can’t get its funding back then we will have to seek alternative funding.

“We’ve got a nice little business with good distribution and we don’t want to lose that. Business is business”

Brett adds: “It’s all well and good being independent like Infinity when the market is doing well but when hit it is good to have the comfort of someone with a balance sheet to ride out the storm.

“I think the storm will go away but that might not be anytime soon – it may take up to six to 18 months.”