Link Lending goes under despite capital injection byits directors
Share
Link Lending has gone into administration despite a capital injection of more than £1m from the bridging lender’s chairman David Johnson.
The company’s accounts for 2008 reveal that Johnson put in the most of all the five directors, who in total had pumped more than £1.6m into the business as of September 2008.
John Maclean, who quit as managing director in September, had lent the firm £120,000 as of September 2008.
The accounts also show that the bridging lender made a profit after tax of £94,391 for the year to September 2008 compared with a £874,810 profit in 2007.
Turnover rose 61%, from £5.8m in 2007 to £9.3m in 2008, leading to an increase in gross profit from £3.5m to £4.9m.
But the lender’s cost of sales led to a loss of just over £4.4m and administrative losses totalled £4.5m.
PricewaterhouseCoopers was app ointed as administrator on October 8 and is working with staff to close the business.
Johnson was unavailable for comment.
A number of lenders have offered assistance to brokers who have been left stranded with pipeline business.
Alan Margolis, chief executive officer of Cheval, says he is aware there could be deals stuck midstream but will help brokers.
He says: “This is a sensitive situation but if there are applicants and brokers whose loans meet our criteria it makes sense for us to try to help them wherever possible.
“Where valuations have already been carried out we will try to use these as the basis of Cheval valuations in an effort to meet borrowers’ time deadlines.”
The Funding Operation and Blemain are also offering to help brokers who have live pipeline business with Link.
Bridging firm Woodberry Securities relaunched as Link Lending in September 2006, headed by John son, Maclean, Paul Gower and Philip George.
If you enjoyed this article, sign up here to receive daily email updates from Mortgage Strategy and Follow @mortgagestrat
