View more on these topics

Technology holds the key to Sandler, says Marlborough Stirling

Marlborough Stirling says it understands the mixed reaction by product providers to the Sandler review and in particular the proposed 1% stakeholder suite of products.

However, it claims that two of the challenges for the industry hold the key to making them work. If the industry can work towards making &#39end-to-end electronic processing of transactions the norm in the industry&#39 and &#39tackling the problems of legacy systems&#39, it says, then very much lower processing costs would result.

It adds that, whilst the detailed nature of such new regulations is yet to be known, it is clear that they will come to pass and ultimately they will benefit those providers that have a flexible approach to product design, multi-channel distribution capability and the lowest operating costs. Those that do not, risk losing market share and ultimately may not survive.

Marlborough Stirling says that rather than fighting the proposals head on companies should work to embrace them and assist the FSA to shape the future regulatory landscape. In terms of the cost of advice, Marlborough Stirling says that lessons could be learnt from the Irish approach to its equivalent of stakeholder pensions, the PRSA, where the cost of distribution has been separated into a premium charge capped at 5% with the annual charge capped at 1%.

In common with a number of leading organisations participating in the financial services market, Marlborough Stirling believes that the FSA should combine the output of all current regulatory reviews, such as CP 121, Sandler and Pickering, and draw up a single set of new regulations that will address the Government&#39s objective of closing the savings gap, whilst enabling product providers and intermediaries to continue to run profitable businesses.

Chris Ryland, director and co-founder of Marlborough Stirling, says: “We believe that the appropriate adoption of new technology is going to be the key facilitator in enabling the industry to meet these challenges. It is not going to be easy and it will take considerable time to implement, thus the industry needs to start addressing the important issues now and must be prepared to invest for the future.”

Recommended

The Virgin One launches first &#39Mortgage Outlook Index&#39

The Virgin One account has today launched the first &#39Mortgage Outlook Index&#39 (MOI), a quarterly index that will monitor the mood of mortgage intermediaries up and down thecountry. The research was carried out by NOP in August and covers the period April to July 2002. The first index has shown mortgage intermediaries to be robust […]

Future Mortgages urges Mortgage Industry to review use of MIG

Future Mortgages is calling for the mortgage industry to review the use and application of Mortgage Indemnity Guarantees. MIG, High Lending Fees or Mortgage Indemnity Payments (MIP), provide lenders with an insurance if the customer defaults on the loan, but unlike other insurance policies the customer paying does not receive any additional benefit. Brian Pitt, […]

Paper tiger

Last Monday, the Financial Services Authority published Consultation Paper 146: The FSA&#39s approach to regulating mortgage sales. From around mid-2004, intermediaries that sell mortgages will need to be authorised by the FSA. Mortgage supremo Sarah Wilson, director of the FSA&#39s high street firms division, says the regulator wants to make sure that “consumers get clear […]

Mortgage advice to be split into three categories

Advisers will have to fit into one of three distinct categories when advising clients on mortgage contracts from June 2004. The FSA has distinguished between three types of selling process in its plans for regulation of the mortgage sales process: advised sales, non-advised sales involving a filter-question system, and non-advised execution only sales. Advised sales […]

Newsletter

News and expert analysis straight to your inbox

Sign up