View more on these topics

RBS takes over 10% share of new mortgages

The Royal Bank of Scotland has reported a 10.6% market share of new mortgage lending in the first three months of the year, its latest results reveal.

Net mortgage lending at the state-backed bank hit £2bn in Q1, compared with an increase of £3.2bn in Q4 2009.

RBS attributes the slower rate of growth to competition in the mortgage market and says it suffered a hit to growth in Q1 as a knock-on effect from completions that were pushed through in December ahead of the end of the Stamp Duty holiday.

RBS added 4,000 mortgage accounts in the first three months of the year, bringing the total number of mortgage accounts to 849,000.

The total number of mortgage accounts is up 10% compared to March 2009.

The bank also received over 54,000 mortgage applications, up 22% from Q4 2009.

Stephen Hester, group chief executive of RBS, says the bank remains on track to implement its five-year plan to overhaul and restructure RBS.

He says: “RBS’s retail and commercial businesses are beginning to recover and should drive our growth over the next few years. 

“While we have taken decisive management actions to improve these businesses, the pace of recovery will also be affected by the rate at which credit conditions change and when interest rates return to more normal levels, giving some relief to liability margins.”

He adds: “As 2010 unfolds we remain optimistic for RBS and the prospects of achieving the plans laid out and our vision to restore RBS to an admired and high performing institution. 

“Progress to date should give encouragement, but there is no complacency within RBS as we continue the work across our businesses.”

RBS has pledged to lend an additional £8bn in net mortgage lending between March 2010 and February 2011.

This comes after the bank exceeded its £9bn net mortgage lending target for 2009 by £3.7bn.

As a group, RBS has reported a operating profit for Q1 of £713m, compared to a loss of £1.35bn in Q4.

After restructuring and other non-operating costs, and £500m paid for the government’s Asset Protection Scheme, the bank recorded a loss before tax of £21m against a profit of £134m in the fourth quarter of 2009.

Recommended

JON KING, MANAGING DIRECTOR, HODGE LIFETIME

Taking a long-term view of the elderly

The trend for people to live longer has been growing for the last couple of centuries. Better standards of living, nutrition and healthcare have combined to improve the expectation of living a longer life. A long-term view helps us to put the impact of annual gradual improvements into perspective. To illustrate the dramatic change, at […]

RICHARD SEXTON

We should do more to promote surveys

Left-field indicators on subjects such as loan performance, consumer confidence and economic recovery seldom make headlines. I recall a lender once telling me that if it was allowed to it could accurately predict the likelihood of borrowers defaulting on their mortgages by analysing their shopping bills. For example, a switch from shopping at Sainsbury to […]

Champion the small-scale developer

Traditional development finance must price in project and liquidity risk, but if your project is completed and you have begun selling units you could be eligible for cheaper funding, writes Matthew Tooth of Lendinvest. A product which prices purely for liquidity risk is one way to help developers lower their costs. This type of product allows […]

Newsletter

News and expert analysis straight to your inbox

Sign up
Comments
  • Post a comment
  • ANONYNOUS 10th May 2010 at 4:41 pm

    Yes and loads of these mortgages are cheap trackers.I always ask clients who went to RBS direct if they can afford the mortgage if it doubles and the answer is always “no”.
    A rod for the taxpayers back,I think, with a mortgage book that will turn bad when rates rise.

  • DAS 7th May 2010 at 1:04 pm

    This morning I referred a FTB direct to RBS Branch for dual priced deal. Later checked my e-mails to find this article!! Re-affirms that this Bank are using Tax-payers money on low margin at the detriment of Lenders who did not go cap in hand and to Brokers who supported them well in the past. At least I maintain my standards of fairness.

  • Ron O'Brien 7th May 2010 at 12:06 pm

    Interesting statements from your article

    “RBS added 4,000 mortgage accounts in the first three months of the year”

    “The bank also received over 54,000 mortgage applications, up 22% from Q4 2009.”

    Am I correct in thinking they turned down 50,000 then?

  • sandyb 7th May 2010 at 12:01 pm

    This does not really tell the whole story, RBS bought business by pricing their direct offers at un profitable levels, not really sure this was a sensible course of action.

    I cannot imagine much of this business was broker introduced as their rates were poor and their service even poorer.