Trade body merger set for mid-2017 after delays

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A financial trade body megamerger is set for mid-2017 after delays caused by trying to find a chairman, Mortgage Strategy understands.

The market was expecting an announcement on the new chairman of the trade body, provisionally called Newta, by the end of last year.

Mortgage Strategy understands there has been a delay in part due to internal disagreement over who the Newta chairman should be.

But a Newta spokesman says the delay was due to the entire merger process being set back by trade bodies taking late member votes on whether to merge or not.

He says: “In the original review and planning, some of the timescales that were set out were based on assumptions as to when the actual organisations would vote with their members to make the decision to join the integration.

“That really didn’t happen until the second half of last year, so that’s the major reason the timescale has been a little bit uncertain.”

The chairman appointment process is still ongoing, and includes both existing staff of the merging trade bodies as well as external candidates as contenders, according to sources close to the merger.

The new trade body will consist of the Council of Mortgage Lenders, British Bankers Association, Payments UK, Financial Fraud Action UK, the Asset Based Finance Association and the UK Cards Association.

The trade body is also working on picking a new name, setting up IT systems, human resources functions and finding a headquarters.

The merger was first suggested in an independent review in 2015 after pressure from nine major UK retail banks and a building society: Barclays, Clydesdale Bank & Yorkshire, Bank, Co-operative Bank, HSBC, Lloyds Banking Group, Nationwide, RBS, Santander, TSB and Virgin Money.

At the time the lenders said they wanted to review the current trade body setup because they wished to cut costs and avoid duplication of work.

The Building Societies Association and the Intermediary Mortgage Lenders Association have ruled themselves out of the merger.