Commercial First places 50% of staff into consultation

Following the announcement last month that specialist commercial lender Commercial First, has been forced to suspend new lending, the company has confirmed that it has entered into a consultation period with its staff.

Stephen Johnson, sales and marketing director at Commercial First, says: “We continue to progress numerous opportunities in order to return to market as soon as we can. Unfortunately our current infrastructure is built to originate in excess of £1bn a year in new lending and we recognise that our activity will certainly be more modest when we are able to resume.

“As a result we need to reduce the teams by around 50% with in the region of 90 staff at risk of redundancy. This will be an incredibly painful process for us as our teams are amongst the most professional and committed people we have ever had the privilege to work alongside. Although the industry is in turmoil, these people will be assets to any business looking to recruit.

“We are unable to confirm when we believe the business will be able to resume lending. Although bond spreads have narrowed and some believe the rescue of Bear Sterns was a turning point, we believe it is unlikely that the securitisation market will function until next year. We are actively pursuing alternative financing for the immediate future and to complement any future reliance upon the securitisation market.”