Mortgage Introducer February 2019

This month we have returned to one of the subjects that really sits behind the FIBA brand and that is for us to continue to raise standards and professionalism in our Industry. I want to pose some questions and highlight a number of areas, which I think are going to be important in the coming year and have already featured strongly in some of the events we have run in 2019. 

We have now hosted four joint trade body meetings with ASTL, which also brought together our members, lender partners, our professional partners and other industry service providers. This is far from a talking shop and the practical outcomes are already being seen because of these Industry Forums. This is not an area of finance that has sought standardisation, whether in terms of the information that lenders require from introducing brokers, through to making it easy to place business with bridging and development lenders on a simple sourcing tool.

However, we can help make it simpler and easier for lenders to assess an initial enquiry, for our members to be able to make their way through the full range of lenders and even for a solicitor unfamiliar with our world to be assisted independently at the outset by Industry experts. For example, one debate centred on the minimum amount of information that would allow a lender to give an in principle agreement subject to the necessary verification. But at this point, as there was so much variation in requirements between lenders, we knew that we could not expect uniformity, but education and awareness will help everyone and we can return to this topic in the future.

As a result of the success of these London meetings, at FIBA we want to regionalise these Forums. We will begin in Manchester in April, followed by Leeds in May, then Glasgow, Birmingham and Cardiff. We have of course scheduled another two in for the capital in conjunction with our colleagues at the ASTL.

Underwriting

Not a week goes past without a new bridging lender coming to market and if you add in the growing number of commercial lenders entering the sector, as brokers and indeed our customers have never had it so good. Yet, there is always a ying to go with the yang in any situation and while the proliferation of lending sources is a cause for celebration, there is a growing underlying worry.

As far as I know, there is no seat of learning dedicated to the art of underwriting, no conveyor belt of newly minted and eager young underwriters, ready to fill the increasing demand for what is a very underrated talent. Where is the next generation of underwriters coming from? There is only so much poaching and moving that can be done and I know that an experienced underwriter is worth his or her “weight in gold” at the moment.

As an industry, lenders will have to look carefully at the available talent they currently have and the amount of work they are going to have to put into ensuring that the next generation is up to the task of making good consistent decisions. Therefore, what can we all do now to help and in returning to an earlier topic above, how can this be combined with ensuring the information at the point of entry from the broker community meets the standards required.

This is the subject of a long running debate and as was pointed out to me yesterday by a truly imminent industry figure at our Lender Committee meeting, the two of us have been talking about this for 15 years. There is a lot to be said about ongoing training and education or as we should call it Continuing Professional Development, and this has to be a consideration in the Education debate.

Women mean Business

Even after all my years in the commercial lending market, I was shocked by the Treasury’s own findings that female entrepreneurs receive on average 157 times less funding than businesses run by men. In stark terms, male only businesses received over £5 billion last year in funding, while the sum afforded to female led businesses was a meagre £32 million.

For every £1 of venture capital investment, less than a penny goes to all female teams according to the British Business Bank. A slight imbalance to say the least. What is worse, 10 years ago the overall proportion of funding going to women was 7% of the total. So regardless of the massive increase in funding sources since that time, the actual proportion going to female start ups and other businesses has tanked.

I am not going to use this article to go through the reasons, because the figures are damning enough on their own without searching for the whys and wherefores.

Suffice to say, that FIBA is going to get behind the campaign to improve the situation and help more women entrepreneurs and business leaders to fund their businesses. Watch this space.

Adam Tyler, Executive Chairman