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Helen Hymos

Future value of packager associations lies in delivering fruitful lender partnerships

The current troubled state of the mortgage market has one main thing in common with all crisis situations, whether they are personal or professional. This is the need to reassess and re-prioritise the things that really matter and downgrade the importance of other non-essentials. At the PMPA we have recently been concentrating on our key strength, which is the one that delivers best added value to our members and their brokers. This is the strengthening of our relationships with our lender panel and putting in place what really matters when it comes to surviving through the current credit squeeze and being ready for the market when it returns. Two major partnership events will illustrate what I mean.

Most recently we invited our panel lenders to our third Lender Forum, a two day event which was held at the New Hall Hotel and spa resort in Warwickshire. The event was organised to create the opportunity for PMPA and its lender partners to meet and discuss issues that will affect the way that the organisations work together in the future, and to reach a consensus about future co-operation. It was attended by senior level executives from our lender panel together with the PMPA executive group. The programme included one-to-one discussions together with a champagne reception and dinner at the end of day one.

Topics for discussion were based on questions raised by the 14-strong PMPA membership and included key issues for 2008 such as: packagers’ role in the delivery of TCF, estimates of time frames with regard to market recovery, integration of IT systems; support for franchise and satellite packaging models; and the anticipated demand for packager distribution – both by volume and packager number. The key issues for packagers as we move forward will be investment in IT, diversification into new areas of business, and delivering added value to lenders

Feedback from our lenders was overwhelming– regarding both the event itself and its positive outcomes – while still acknowledging that lenders and distributors will be operating in a very tough market for most of 2008, if not beyond. Most encouragingly, all lenders present have given their strong support to continued dialogue and partnership with PMPA and its member packager/ distributors.

This Forum, achieved and surpassed its aims in providing time and space to discuss future strategies with our lender panel, which includes the top lending organisations in the UK intermediary sector. The formal sessions were complemented by opportunities to speak to our lenders informally, giving us the chance to cement relationships with existing contacts and establish rapport with new ones, for the benefit of the whole PMPA membership. By mutual consent, we hope to repeat this exercise in future and establish it as a key date in the calendar.

At the end of 2007 we also held our first Lender Round-Table Forum, which was attended by representatives from all our member firms 18 of our lenders. On this occasion, each member and lender had the opportunity for one-to-one discussion, to promote greater awareness and understanding of each other’s needs in the current marketplace.

It was agreed that a common denominator for all of us is that we are currently witnessing the most challenging times in our industry since the late eighties and early nineties, which is particularly affecting the niche areas of the market place that have become especially important for packagers i.e. sub-prime, self-cert and BTL. The round table created an opportunity for members to understand the lenders issues and to understand why they have withdrawn from some asset categories and tightened their criteria. Issues, discussed included the areas of the market place where the FSA is driving for changes and putting pressure upon lenders. For example, in areas such as TCF and self-cert lending. It also gave members the opportunity to discuss any specific issues or problems that they may have with specific lenders in order to overcome them, build, and move forward with, hopefully, more business.

We are confident that the strong relationships and goodwill generated between PMPA and its lenders during these testing times have the potential to develop even more fruitfully, both now and once more stable and favourable market conditions return.

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