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Portillion – Gearing up for battle

Checkmate, or Portillion as it is now known, continues to keep the mortgage market on its toes regarding the strategy it will take when it launches its assault on the mortgage market.  

The big question is, will it come in all guns blazing or will it take the slow and steady approach?

The board of Portillion reads more like a who’s who of financial services, with key appointments to its non-executive board such as  Gerald Gregory, ex-director of Britannia Building Society and Jeremy Sillem, former chairman of Bear Stearns International Limited – the European arm of the New York based investment bank.

Chief executive officer Stephen Knight is without doubt building an army of recruits that makes it tricky for any regulator to turn down.

An ex-FSA director Ronnie Baird has even been appointed to act as senior non- executive director and chairman of the audit committee.

Portillion promises to offer clear and fair products 
and to “do something out of the ordinary” to help its customers.

But as yet there has not been any details as to its funding plans – the appointment ofPhilip Dearing, previously chief executive officer at Market Harborough Building Society as savings director suggests a reliance on retail funds.

But if the lender is to make a dent in the UK mortgage market its funding plan is going to have to be more diverse than reliance on just one source. There are also rumours the lender might have a secret weapon in the form of a large backer.

Portillion currently has backing from RIT Capital Partners, Lord Rothschild’s family interests and Lazard.But the FSA will want to know the ins and outs of any business plan before it grants it authorisation.

The changes to its name and additions to its board would point to Knight and his team doing everything necessary to secure the regulator’s approval.

And all the signs suggest that Portillion’s assault on the mortgage market is drawing closer, let’s just hope that its military strategy is correct.

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  • nICK 21st March 2010 at 9:25 pm

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  • RMBS_Trader 25th February 2010 at 6:04 pm

    It’s interesting to read about Checkmate/Portillion and the board being a ‘who’s who’ – indeed it does, but of a list of entities that have ultimately failed, not succeeded through the credit crunch.

    Stephen Knight is good at riding a wave of general market success, as he did with GMAC-RFC, but then left when things turned against the lender.

    It now seems he is hoping that old stratgies will work in a new market – they won’t. His apparent unyielding support for the intermiediary market is an example of this – how can he support them when all the best products are reserved for the banks own customers?

    And quite right too. In a market where lending is limited (146bn compared to 370bn at the peak) banks can afford to continue to offer their best margins to those who come direct and bank with them. The days of volume over quality are long gone, and that’s a good thing.

    I am sure there will be some retort to this in saying the primary capital markets are opening, per the Permanent, Silk, Fosse and other deals, and that big lending ‘has to come back’. No it doesn’t, and arguable shouldn’t.

    Sensible lending is the way forward. Not the blindly automated underwriting, automated valuation model type lending that got us in this mess – and also ruined the (past) lenders of much of the Portillion’s new board.

  • RMBS_Trader 25th February 2010 at 6:03 pm

    It’s interesting to read about Checkmate/Portillion and the board being a ‘who’s who’ – indeed it does, but of a list of entities that have ultimately failed, not succeeded through the credit crunch.

    Stephen Knight is good at riding a wave of general market success, as he did with GMAC-RFC, but then left when things turned against the lender.

    It now seems he is hoping that old stratgies will work in a new market – they won’t. His apparent unyielding support for the intermiediary market is an example of this – how can he support them when all the best products are reserved for the banks own customers?

    And quite right too. In a market where lending is limited (146bn compared to 370bn at the peak) banks can afford to continue to offer their best margins to those who come direct and bank with them. The days of volume over quality are long gone, and that’s a good thing.

    I am sure there will be some retort to this in saying the primary capital markets are opening, per the Permanent, Silk, Fosse and other deals, and that big lending ‘has to come back’. No it doesn’t, and arguable shouldn’t.

    Sensible lending is the way forward. Not the blindly automated underwriting, automated valuation model type lending that got us in this mess – and also ruined the (past) lenders of much of the Portillion’s new board.