A&L to launch specialist products with Lehman

Alliance & Leicester last week confirmed plans to launch a set of specialist products through a tie-up with Lehman Brothers, adding that it may consider putting these on its own books in future.

The lender says it will soon start to distribute buy-to-let, self-cert, near prime and sub-prime specialist mortgage products through brokers and the assets originated will be sold to Lehman Brothers.

Mehrdad Yousefi, head of intermediary mortgages at A&L, says: “The products will hopefully be out in the next few weeks. They will be competitive but we will enter the markets gradually. If they are successful over the next few years we will consider putting them on our balance sheet.”

Yousefi says A&L will not be innovative with the products in the early stages but that is likely to happen further down the line.

Meanwhile, A&L says it will continue to focus on the prime residential mortgage market.

The lender recently announ-ced that its gross mortgage lending stood at 3.2bn, with net lending rising to 1.4bn in the first quarter of this year.

Also last week, Credit Agricole, the French bank rumoured to be considering making a bid for A&L, offered $3.9bn for Emporiki, Greece’s fifth largest bank.

Credit Agricole says this will not affect its assessment of whether or not to bid for A&L, but shares in A&L dropped almost 9% following the news.

It is thought that if A&L shares drop further, this could prompt other potential bidders to make their move including Spanish bank Banco Santander, owner of Abbey.

If Santander took over A&L, the lender combined with Abbey would rival HBOS in terms of size.