The Professional Mortgage Packagers Alliance will close its doors on September 30 2008.
In view of current market conditions, the directors of PMPA have decided to relinquish their ownership of the packager alliance and concentrate on the day to day running of their main businesses.
The news comes after Vic Jannels retired as the chair of association in August.
Helen Hymos, acting chair of PMPA, says: “In this current economic environment it is crucial to understand the importance of all packager firms to focus on the businesses which actually provide their living.
“Every member of PMPA has value as a single business, and I believe that lenders will continue to have packaging agreements with good packagers of all sizes.
“It is fair to say that PMPA has been an exciting venture since inception in 2000 – sometimes invigorating with new lender panel appointments and exclusive product launches and sometimes frustrating when endeavouring to pull everyone in the same direction for the benefit of the whole membership.
“PMPA was the first of the packager alliances and it was some time before we were followed by RAMP and others, all of whom recognised the value of a group working together.”
Hymos says times have now changed and PMPA is taking the lead once more in recognising that the days of the packager alliance are numbered as lenders review their “to market” distribution needs in a totally different light.
It believes lenders will still require distribution and that will be, in large part, through packager companies. However, this is not likely to be in the volumes or style that we have seen hitherto.
She adds: “We believe that lenders will manage their distribution in smaller, more controlled tranches of business through much tighter relationships and with fewer distributors.
“It is our considered view that they will not, in the foreseeable future, allocate products or packaging agreements to all members of wide groups or alliances, but via closer individual business partnerships.
“This is already manifesting itself as seen in the recent culling of packager companies by some lenders who are starting to choose the business/ distribution partnerships that they will focus on in the brave new mortgage world.
“We believe that PMPA achieved its objectives very successfully and set the trend of bringing lenders and packagers closer together during the early to mid part of the decade. The ultimate business skill is to recognise when you have gone as far as you can.”
The directors of PMPA believe that they have reached that point now, and that it is important to take stock and consider ‘where next’.
She adds: “It is for these reasons that the directors have decided to close PMPA and encourage all member firms to concentrate on ensuring the continued growth of their individual businesses. The directors of PMPA wish the remaining packager alliances all the best for the future, and will follow with interest their ongoing strategies”
Helen Hymos is now in the process of working with all PMPA’s lenders and members to achieve an orderly and professional conclusion to the association’s business activities, and the best possible outcome for all PMPA member firms going forward.