Kensington Mortgages managing director Alison Hutchinson has come a long way from her early involvement with her family’s businesses in Helensburgh, Scotland.She only joined Kensington last year and is now guiding the lender through its 10th year, during which she expects the company to do 3bn worth of business, taking the total business the company has done since its launch in 1995 to 10bn. It’s proving to be a year of landmarks, with Kensington’s 100,000th customer coming along in July. “I come from Helensburgh where my dad was involved in a lot of different businesses. I started out serving at a dry cleaner,” Hutchinson says. And the family work ethic certainly runs through Hutchinson’s blood with her career progressing at a rapid rate. She graduated from the University of Strathclyde and then moved to Newcastle in 1986 to work for IBM, where she stayed until 1990. “My last major role at IBM was running financial services across the globe,” she says. “I was chief executive of a European forum that brought together 16 banks from seven countries.” From IBM she went to Barclays where she stayed for four years, two of which she spent as marketing director of Barclaycard. “I led the rebranding and repositioning of Barclaycard. I was given a massive rock by Jennifer Aniston who was in some of the adverts – but it wasn’t real,” says Hutchinson. Somehow she also managed to find time to run a dancing school including tap, ballet, modern, jazz and highland styles, but she can no longer fit this in with three young children. Then last October she joined Kensington where she is relishing the challenge of leading the business that helped create the modern day sub-prime market in the UK. Despite being with the lender for less than a year her impact is hard to ignore, including the speed at which business now gets done. “There’s certainly been an increase in the pace at which everyone works,” Hutchinson says. “There’s more of a focus not only what we do but also on how we do it. Commercialism, accountability, professionalism, teamwork and customer focus are all values that matter to us.” There was also a management shake-up at the start of the year, which Hutchinson describes as streamlining – a process that is now complete. New people were brought in including Ian Ferguson who joined in July as chief operating officer from Bradford & Bingley and Luis Marino who arrived as director of marketing and strategy from Nationwide. But the latter appointment did not work out and Marino has already departed. Kensington has also expanded its distribution. It started dealing with brokers direct for the first time this year but Hutchinson insists this is to complement the packager channel rather than compete with it. “It’s not about one channel being better than another, the idea is to increase choice. Packagers definitely still have a future,” she says. The company also moved into branded lending in August and following a successful first phase is looking to extend this. A part of the business rumoured not to be doing so well is the direct to consumer arm, The Mortgage Lender. But Kensington insists it still regards this as an investment. “It’s still an important part of the group and is still a channel for us, but direct to consumer is a challenging market,” says Hutchinson. A channel Kensington is growing is referral business introduced through corporate partnerships, with two more due to be signed off soon and another two in the pipeline. Hutchinson says another area where she has been active is in widening the range of products offered to include near prime mortgages although she admits many brokers still regard it as a heavy adverse lender. She realises more work needs to be done to educate the market to understand this is no longer the case. Kensington was involved in takeover talks earlier this year, with the market speculating that Abbey would like to snap it up, but the discussions were halted. With Kensington’s share price continuing to rise, there are still rumours it could be taken over and Hutchinson agrees this is not something that can be ruled out. “We’ll always have people interested in buying Kensington, that won’t go away,” she says. “But as an independent lender we have a lot of advantages. We’re in a different situation from the likes of GMAC-RFC. We can make a decision within minutes and offer a personalised service.” A market Kensington serves well, and one in which it wants to further improve its offering, is self-employed clients. “Kensington knows what customer needs are, especially when serving the self-employed who form a large part of our business,” Hutchinson says. “Clients don’t have to prove they have a record of running a successful company as they can get a mortgage from us from day one rather than having to wait, say, three or six months. “Our view is that bright people are self-employed so it’s not right to call them sub-prime. They are people with specialist needs who need a specialist mortgage. It surprises me that we try to put people into a single box when they have different requirements.” In the future, Kensington wants to better serve specific groups of customers, such as divorcees who have their own financial issues and need tailored financial packages. It is also looking at re-entering the second charge market and expanding the range of insurance products it offers. “We used to do second charge through Kensington Personal Loans until we floated in 2000,” Hutchinson says. “We’re now going back to looking at that second charge market as it is a logical extension of what we’re doing. We’re also looking to sharpen our focus on insurance, which has a complementary product set to mortgages. “While we have a good product range, it could get more competitive in household insurance and accident, sickness and unemployment.” Another challenge is to widen the number of brokers and IFAs who do business with Kensington through an education and awareness programme. “We want to extend the knowledge base of the range of Kensington products and open up the packager and adviser market,” Hutchinson says. Though it has Start Mortgages in Ireland, Kensington will concentrate on expansion in its home market. “There is potential for geographic expansion but it’s not something we’ll do in the near future as there is a lot more growth yet in our heartland,” she says. “We’re growing fast organically but if the right acquisition opportunity comes along we’ll look at it.” Kensington will keep a focus on first charge mortgages, looking to grow areas such as Right to Buy and buy-to-let where it has not hitherto been a major player. And Hutchinson is confident there is still growth potential in Kensington’s traditional markets. “There’s even more requirement for people to have their specialist needs met now,” she says. “But these are not the desperate needs of the past when people had nowhere to go. Regulation has created a level playing field and has been good for the industry.” On a personal level, Hutchinson says she has enjoyed getting to know the mortgage market and its characters in the last year. “It’s a small industry, a lot smaller than I thought in terms of the number of players and the range of approaches to businesses. There are a few big personalities that you don’t have in other financial sectors. But it’s a competitive industry and that will intensify. There will be a lot more new lenders but equally there will be consolidation. “It’s an attractive place to be and there’s so much opportunity. I’m like a child with lots of new toys and ideas.” One thing Hutchinson feels strongly about is people’s attitude to debt and their knowledge of managing their finances. “There’s a big responsibility on financial services to help educate people to be responsible borrowers – we have to get through to individuals,” she adds. “I wish we had managing money as part of the schol curriculum. It’s really important – there’s nothing as true as the saying ‘look after the pennies and the pounds will look after themselves’.” And with John Maltby as a steady chief executive and Hutchinson as a dedicated and ambitious managing director, it looks like Kensington’s pennies and pounds are in good hands.
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