View more on these topics

RIP Salt Finance and CMB

Nationwide has absorbed the Cheshire and the Derbyshire’s broker arms following its mergers with the mutuals last week.

Both brands will retain their branch presence for the foreseeable future but it’s the end of the line for Salt Finance and Cheshire Mortgage Brokers, which will be folded into Nationwide’s broker offering.

The mergers came on the back of news that the mutuals had combined losses of £27.5m in 2007.

The Cheshire says it expects to incur an unaudited pre-tax loss of £10.5m for the six months to June 30 2008 due to a one-off £11.5m impairment charge on a single secured commercial loan. And the Derbyshire expects to report an unaudited pre-tax loss of £17m for the same period, with losses arising predominantly in its near-prime, sub-prime and commercial loan portfolios.

Matthew Wyles, non-retail director at Nationwide, is bullish about the future thanks to the additions of Salt Finance and CMB.

He says: “The changes give Nationwide greater economies of scale and the ability to remain competitive in the market. For brokers it will be business as usual as both the Cheshire and the Derbyshire were small and likely did not figure in most of their business.”

Vic Jannels, managing director of All Types of Mortgages, says the mergers could be the beginning of a trend.

He says: “The current market and the need for prudence and regulatory management could lead to more mutuals coming under the wing of larger ones to create economies of scale.”

But Adrian Coles, director-general of the Building Societies Association, says there have always been inter-society mergers, so it’s no surprise to see them now considering prevailing market conditions.

Recommended

BDS Secured increases sales team

BDS Secured Loans has appointed two broker sales managers.Richard Norman and Wayne Berry join BDS Secured Loans from c2 where they were part of their sales team. In their new roles, they will be responsible for dealing directly with introducing brokers and increasing sales volumes. This recruitment is in response to the significant rise in […]

Prestbury set to transfer all ARs to PTFS

Prestbury Holdings has revealed it will move forward with the transfer of all appointed representatives to Personal Touch Financial Services.

Gross lending declines in August

Gross lending totalled an estimated £21.8bn in August, a 12% fall from July and a 36% fall from August 2007, show figures from the Council of Mortgage Lenders.

Newsletter

News and expert analysis straight to your inbox

Sign up