Commercial Broker (NACFB Magazine) February 2019

Issue 67

FEBRUARY 2019

Broker COMMERCIAL

The magazine for the National Association of Commercial Finance Brokers

24 MINIMUM STANDARDS REVIEWS A broker community greater than the sum of its parts

34 UNDERSTANDING VALUATIONS Arming brokers with the tools needed to deliver the best advice

Embracing technology How digital advances will empower brokers

36 STATE OF PLAY SME willingness to consider emerging sources of funding

40 RISK APPETITE Addressing increased underwriting scrutiny from UK lenders

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Contents

In this February issue NACFB News

Special Features

4 6 8 10-11 12-14

28-29 Funding Circle: Helping

Note from Graham Toy Updates from the Association Note from headline sponsor Industry news round-up Patron news

each other go further

embrace technology

the valuation process

30-32 Why brokers should

34-35 LendInvest: Demystifying

Industry Insight 36-37 UK Finance: Financing

SMEs in 2019

to lender

38-39 Keystone: From broker

Opinion & Commentary 40-41

24

Case Studies

16 UTB: Speedy decision making 18-19 Praetura: Asset refinancing 20 Bank & Clients:

Arc & Co: Adapting to more vigorous underwriting 42-43 BBB: Bridging the finance gap 44-45 Folk2Folk: Introducing folkonomics 46 Invest&Fund: Continued

viability of P2P lending 48 Listicle: Top UK cities

for entrepreneurs 50 Five minutes with:

Simon Cureton

33 Eastcheap | London | EC3M 1DT Kieran.Jones@nacfb.org.uk

33 Eastcheap | London | EC3M 1DT Laura.Mills@nacfb.org.uk

Paragon Bank: Market evolution RUTH DUNN Magazine Advertising T 0845 0043169

Magazine@nacfb.org.uk

Greater than the sum of our parts

Ask the Expert 26

KIERAN JONES Communications Manager & Editor

LAURA MILLS Magazine Production Assistant

Compliance Update 24-25

Further Information

Holistic financing

Patron Profile 22-23

34

Stuart Brierley: Towergate Hull

MACKMAN Design & Production T 01787 388038

40

mackman.co.uk

NACFB | 3

Welcome

Graham's Note W

elcome to the second edition of our re-engineered magazine. Included in one of our insight pieces are some views on technology and how we think it will impact our industry. If we are honest, we know that technology will continue to grip our industry and almost certainly for the better. We all know that the pace of change is growing at an ever-increasing rate and what might sound somewhat rarefied today will become business as usual in a short space of time.

Like so many of our Members, I have spent many years building relationships with SMEs and on the back of those relationships, and an understanding of their business, contributed to their plans and aspirations with the provision of financial products and services.

Granted that much of the due diligence was, and still is, a necessary element of the customer journey. What then happens in the change continuum is that a concept that you have heard talked about takes the significant leap from theory and concept into practical applicable technology which transforms the customer journey from the perspective of the borrower, broker and lender.

Graham Toy Chief Executive Officer

NACFB

A brilliant example of this was demonstrated at the Credit Strategy Lending Summit last November, when open banking was exhibited, but not just a theoretical lecture on the concept, but real-life examples of the speed, agility and granularity of the data flow.

You might agree that not all elements of commercial lending due diligence would ever be badged as exciting but exploiting this technology to help fund UK business feels like a move to a different paradigm. The challenge for the lending community is to be fast into embracing this technology whilst it is still possible to create an edge.

If we then return to the importance of relationships, you have with open banking, a more intimate knowledge and visibility of the data which provides more time with the borrower and insight into their enterprise.

Another piece of technology much talked about, but much less understood is Blockchain. It seems to me that there is a significant degree of polarisation in the industry about its usefulness, probably caused by its complexity, but my view is that our general thirst for new and innovative processes to address regulation, service and profit will ultimately trump the anxiety of stepping too quickly into the unknown.

4 | NACFB

NACFB News

Association updates for February 2019

Events in 2019 – the road to Expo Join us at our sector specific roundtable sessions this year

L

ast year saw the Association stage more events than ever before; with nearly 500 brokers joining us across 30 regional roundtable days. We’ll be continuing these sector specific days in 2019, but we’ll be tweaking the structure a little, allowing brokers and lenders to extract more value from the events.

This year’s programme will see the sessions shortened and paired with complementary sectors, for example our Commercial Mortgages roundtable day will share the billing with our Buy-to-let day.

Check out below our programme of regional events including Member and Patron days, culminating in the NACFB Commercial Finance Expo in June.

Dates for your diary Commercial Mortgages Roundtable (Morning session) Date & Time: Wednesday 13th February - 9am-12pm Location: Radisson Blu Edwardian Vanderbilt | 68-86 Cromwell Road | Kensington | London | SW7 5BT Buy-to-let Roundtable (Afternoon session) Date & Time: Wednesday 13th February - 1pm-4pm Location: Radisson Blu Edwardian Vanderbilt | 68-86 Cromwell Road | Kensington | London | SW7 5BT Bridging Finance Roundtable (Morning session) Date & Time: Wednesday 6th March - 9am-12pm Location: Radisson Blu Birmingham | 12 Holloway Circus Queensway | Birmingham | B1 1BT Development Finance Roundtable (Afternoon session) Date & Time: Wednesday 6th March - 1pm-4pm Location: Radisson Blu Birmingham | 12 Holloway Circus Queensway | Birmingham | B1 1BT NACFB Members Day Date & Time: Thursday 14th March - 1.30pm-4.30pm Location: Hilton Leicester | 21 Junction Approach Leicester | LE19 1WQ 6 | NACFB

NACFB Patrons Day Date & Time: Tuesday 19th March - 1.30pm-4.30pm Location: Radisson Blu Portman Hotel | 22 Portman Square London | W1H 7BG Factor & Invoicing Roundtable (Morning session) Date & Time: Wednesday 3rd April - 9am–12pm Location: Radisson Blu Edwardian Vanderbilt | 68-86 Cromwell Road Kensington | London | SW7 5BT Cashflow Roundtable (Afternoon session) Date & Time: Wednesday 3rd April - 1pm–4.30pm Location: Radisson Blu Edwardian Vanderbilt | 68-86 Cromwell Road Kensington | London | SW7 5BT Asset Finance Roundtable (Morning session) Date & Time: Thursday 9th May - 9am-12pm Location: Holiday Inn Bristol City Centre | Bond Street Bristol | BS1 3LE Cashflow Finance Roundtable (Afternoon session) Date & Time: Thursday 9th May - 9am-12pm Location: Holiday Inn Bristol City Centre | Bond Street Bristol | BS1 3LE We’re immensely proud of our flagship event, the NACFB Commercial Finance Expo. The event will return to its home at Birmingham’s NEC once more on Wednesday 19th June 2019. Building on last year’s record-breaking Expo, 2019 will boast more lenders and suppliers under one roof than any other event in the UK. The event is about doing business, networking and education, but it is also an entertaining affair with a well-established, good-natured rapport between all exhibitors and attendees. It remains one of few places that brokers can see all their lenders and funders in one place on the same day.

NACFB Commercial Finance Expo Date & Time: Wednesday 19th June - 9.30am–4.30pm Location: National Exhibition Centre | Hall 3a | Birmingham | B40 1NT Sign-up today via: commercialfinanceexpo.co.uk

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Note from our Sponsor

Encouraging a more holistic approach Commercial Broker sat down with Andy Bishop, National Director of Business Development SME Banking at Lloyds Bank to discuss the year ahead

2019 is undoubtedly a year of change, what changes can we expect to see from the Lloyds Bank offering?

Our door remains very much open for business in what is an uncertain environment. Lloyds Banking Group's commitments to ‘Helping Britain Prosper’ remain the same, which is £6 billion of net lending growth in both the SME and mid-corporate space over the next three years. More specifically in 2019, our expansion into the mid-corporate space will see us looking to support broker-led trading businesses up to £100 million in turnover. Equally, we are at the moment undertaking research and engaging with brokers to ascertain how we develop a digital proposition, we’re very much looking for brokers to shape that – making processes slicker and quicker.

How can brokers adapt their processes to ensure lending to SMEs continues?

There is a real opportunity for brokers to build upon their trusted partner status with clients. Something that is absolutely key for brokers will be to not only understand the transaction that their client is entering into, but also how their clients are protecting themselves from all forms of risk. It is important that brokers recognise what their clients’ longer-term strategy is, taking a more holistic view.

Are you anticipating market corrections this year?

[Laughs] If I knew the answer to that I’d be lying on a beach in Barbados! We are operating in a very fluid environment, but our mantra has always been to be there throughout the cycle – both in good, and potentially difficult, times.

2018 was a good year for Lloyds Bank, what was your highlight of the year?

It has to be the £1.2 billion of committed lending through the SME Business Development team facing into the broker world – our highest ever figures.

8 | NACFB

What learnings will you take from last year?

For me a key learning is that digital development is all around us, but the broker and the client need to be at the heart of proposition development. Digital will be one channel of choice and support for some clients but there will always be an opportunity for the relationship management approach. For a lot of clients, particularly as they become more complex, that trusted status that brokers hold becomes key. The other learning for me is to act on broker feedback to help us develop propositions.

How do you anticipate the broker/lender dynamic changing in the coming years?

We will still see an increase in growth of multi-product brokers.

We have already seen the birth of super-brokers and I think we will see more. We believe that the broker market is growing more rapidly than the overall market, which is a good thing, new generations of introducers are seeking out opportunity.

Outside of London, what other areas of the UK are you seeing lending growth in?

This is an easy answer, everywhere. In every part of the UK the number and volume of business through the broker channel rose last year.

What UK sectors do you anticipate growth in?

I anticipate growth across all sectors – there is opportunity everywhere. With the rise in multi-product brokers we’re seeing a much wider range of sectors being supported.

What advice do you have for NACFB brokers in 2019?

My advice would be to keep close to your clients. Take the time to understand the needs of your clients, both now and in the future.

This includes their medium-term strategy and ambitions – not just focus on the deal in isolation.

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Industry News

Industry News 1. SMEs expected to switch banks

5. Small firms warned of pension errors

New research has revealed that 84% of industry professionals believe that more SMEs will switch banks this year.

According to the Co-operative Bank, 86% of SMEs are open to switching their business current account. Further research

by Unisys Corporation shows that 47% of UK SMEs would move to a challenger or non-banking brand if they decided to switch.

Former pensions minister Baroness Altmann has said that the pensions industry is not up to scratch when it comes to handling data. Research has found that many small firms still process employee auto-enrolment data manually via spreadsheets, half of which subsequently contain errors when uploaded to pension schemes' systems.

2. Late payers to be named and shamed

6. 200,000 start-ups utilise streamlined registration

Large firms that fail to pay their suppliers on time are set to be named and shamed, with small business commissioner Paul Uppal set to detail plans for a traffic light warning system. This initiative will highlight firms which repeatedly make late payments, as well as those who fail to report details of payments.

Over 200,000 UK start-ups have used the Streamlined Company Registration Service set up by HMRC and Companies House. The service lets new entrants register as a company and for tax at the same time. Financial Secretary Mel Stride said: “It's never been easier to setup a business in the UK.”

3 3. Construction growth dips The IHS Markit/Chartered Institute of Purchasing & Supply activity index shows that the construction sector hit a three-month low in December. The index dropped from November’s 53.4 to 52.8.

Although the figure still sits above the 50-mark, pointing to growth, it comes in short of the 52.9 forecast by economists.

4. Amicus Asset Finance re-enters private ownership

2 10 | NACFB

Amicus Asset Finance Group has entered back into private ownership after three years under the ownership of Amicus Finance. Robert Keep, managing director at Amicus Asset Finance, commented: “We have a great team here, excellent support from our bankers and senior debt providers and an active introducer network. We look forward to a great year in 2019 serving our broad and varied customer base.”

7. New guidance body launched The Money Advice Service, the Pensions Advisory Service and Pensions Wise have been pulled together to form the Single Financial Guidance Body. The financial advice service is sponsored by the Department of Work and Pensions and funded by levies on the financial services industry and pension schemes.

7

8. NACFB Patron appointments Sundeep Patel has been appointed as Together’s head of London intermediaries.

Elsewhere, Gary Bailey has been appointed managing director of Hope Capital. Mr Bailey joins the specialist lender after spending over 20 years at Together, where he held the role of sales director. Separately, Assetz Capital has appointed David Reed as regional relationship director in Yorkshire and the Humber.

9. Salaries climb as employers struggle to fill job vacancies A shrinking pool of available workers combined with a sharp increase in the number of vacancies in December 2018 has driven starting salaries up, according to a report by KPMG. Accounting and finance roles along with engineering jobs had the highest number of advertised permanent roles.

10. House price growth slowest in nearly six years

8

UK house prices grew at an annual pace of 0.5% in December, compared to 2.6% in 2017, according to Nationwide Building Society – the slowest annual rate since February 2013. Northern Ireland saw the biggest house price rises, up 5.8%. Prices in Wales climbed 4%, in Scotland they were up 0.9% and in England they rose 0.7%.

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NACFB | 11

Patron News

Mercia boosts SMEs with almost £60m invested in 2018

M

ercia invested £59.7 million in 2018, with over 90% of the funding going to businesses outside of London and the South East. The figure, up from £48 million the previous year, highlights Mercia’s role as one of the UK’s most active investors and a key source of funding for regional SMEs.

The NACFB Patron made investments in 137 companies during the year, of which 125 were outside of London and the South East.

The figures show that Yorkshire and the Humber (where £15.7 million was invested into 57 companies), the North West (£14.3 million invested into 24 companies) and the Midlands (£13.3 million invested into 22 companies) were the regions receiving the most investment over the 12 months. Mercia invested £2.5 million in six companies in Scotland during the year.

During 2018 the group increased its third-party funds under management from £350 million to over £400 million at 31st December, as a result of Mercia being appointed to manage the £23 million Proof-of-Concept and Early Stage Equity Fund, part of the Midlands Engine Investment Fund, and the £27 million North East Venture Fund, and raising a further £8 million in EIS funds.

During the year Mercia also opened a Newcastle office and continued to expand its team. It now has over 80 employees in eight locations and partnerships with 19 regional universities. According to recent reports from Beauhurst, Mercia is one of the top four investors into university spinout businesses, and one of the UK’s top 12 | NACFB

four most active venture capitalists specifically focussed on innovation.

Growing by approximately 30% per annum, Mercia has built a venture portfolio of in excess of 170 companies created and financed via its third-party managed venture funds. Using Mercia’s own cash resources, it has selectively scaled the most promising companies sourced from this venture portfolio to include synthetic biology company Oxford Genetics, VR company nDreams, speaker company Warwick Acoustics, aluminium shaping company Impression Technologies and bot mitigation company Intechnica.

Mercia has built a reputation as a supportive investor. In a recent survey of portfolio companies, 84% of respondents said they were likely to recommend Mercia to other entrepreneurs and 75% had already done so.

Mark Payton, chief executive of Mercia Technologies PLC, pictured, said: “Regional cities such as Birmingham, Newcastle, Leeds, Sheffield, Manchester and Edinburgh are increasingly important technology hubs, however venture capital remains heavily focussed on London.

“Mercia has offices in all of these locations and as these latest figures show, it is addressing this shortfall by sourcing and backing exceptional businesses across the UK’s regions. Building on a successful 2018, I expect Mercia to continue to scale its activities into 2019.”

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Patron News

HTB bolsters asset and development divisions

N

ACFB Patron, Hampshire Trust Bank (HTB), has announced the relaunch of its Asset Finance division as Specialist Business Finance. The division has launched a new specialist business line, Structured Asset Finance, to complement the existing core offering which will remain unchanged.

The new structure comprises broker asset finance, wholesale lending and a series of specialist business lines, the first of which is Structured Asset Finance.

Hampshire Trust Bank has appointed Robert Still and Richard O’Brien to lead the Structured Asset Finance business. Robert and Richard join from Amicus Asset Finance where they served as director of business development and business development manager respectively.

The team are based in London and will report to Jon Maycock, managing director of the Specialist Business Finance division.

The Structured Asset Finance business will support the existing lines and focus predominantly on re-structuring businesses debts with a typical ticket size ranging from £250,000 to £2.5 million.

Commenting on the relaunch, Jon Maycock said: “Despite lending bouncing back since the economic crisis of 2008 there is still a gap in availability of funding for UK SMEs. We have made exceptional progress over the last four years and are well positioned to build 14 | NACFB

on our success in this growing market to help close this funding gap and ensure the future for UK SMEs.” The news comes as the bank’s development finance division announced it is to open a new Northern headquarters in Leeds city centre. The division has been operating in the North of England for nearly two years and, in 2018 alone, the Northern team sanctioned over £127 million in loans spread across 40 borrowers.

HTB’s North of England operations are led by Neil Leitch, a director in development finance. He is currently supported by David Whitehouse, regional lending manager (Yorkshire and The Humber) and Paul Fellowes, regional lending manager (Manchester and The North West). The new Leeds office will be focussed on expanding HTB’s presence in that region, including the North East, the North West, Yorkshire and Humber.

David Alcock, managing director of development finance at HTB, said: “We have witnessed huge growth in London and the South East and now feel it is the right time to expand our on the ground operations in the North of England, a region that has traditionally been under-banked in property development lending. Today’s announcement is the culmination of nearly two year's planning by the team and I have every confidence that we will replicate our success in this key regional hub. In Neil, we have an experienced property finance professional who possesses a deep understanding of that region.”

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Case Study

A quick decision on a £1.8m property improvement facility Gavin Diamond Commercial Director Bridging United Trust Bank

O

ur customer, Bruce Burkitt of propertyexperts.co.uk, is an experienced and successful property professional and has developed over 700 units, many of which he has retained for his multi-million-pound, private portfolio.

Whilst Bruce and his team continue to grow his portfolio, he also provides mentoring sessions for budding developers as well as overseeing projects for retained investor clients.

On this occasion, Mr Burkitt had identified a detached, three-storey house in South Croydon with potential to convert to seven self-contained flats. Once completed, the flats would be let and added to the company’s growing Buy-to-let portfolio.

The house was previously used as a children’s home and the improvement works required were extensive. As well as internal remodelling, Mr Burkitt planned to excavate the basement and add a single storey extension to the rear.

Mr Burkitt had obtained permission to convert the house prior to committing to the purchase. Having recently completed a similar scheme on an adjacent property, he was well prepared for any complications and knew what was needed to deliver another successful project.

Mr Burkitt contacted broker Bruno Welch of Commercial Finance Practice who in turn approached United Trust Bank to provide the circa £1.8 million required to cover the purchase price, cost of works and other fees, costs and interest for the 12-month facility.

As a valued UTB customer and someone the UTB Bridging team have known for many years, we were keen to support his latest project.

By providing us with a charge over three unencumbered properties within his portfolio in addition to the Croydon house, Mr Burkitt was able to keep his cash requirements to a minimum. The proceeds of

16 | NACFB

the loan facility provided him with a Day 1 amount to buy the property and then fund 100% of the total cost of works in tranches, an overall loan facility of 66% of GDV. The works were estimated to take eight-nine months with the completed flats valued at around £2.5 million. The exit to the UTB bridging loan will be via a BTL refinance once the scheme is finished.

As well as the usual valuations, UTB’s in-house asset manager, Nick Hudson, met Mr Burkitt and his team on site to appraise and fully understand the scheme, as well as visit Property Expert’s similar conversion nearby.

With everything in order, UTB quickly agreed the facility, their lawyers arranged the security paperwork and the first tranche of the facility was drawn down soon afterwards.

Bruce Burkitt commented: “The speed of arranging bridging, especially with a specialist like UTB, is really important to me. Despite what some market indices might suggest, it’s a competitive market and there’s always interest in sites and properties with development potential. When I see an opportunity, I must be able to move quickly.”

“

By providing us with a charge over three unencumbered properties within his portfolio in addition to the Croydon house, Mr Burkitt was able to keep his cash requirements to a minimum

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Case Study

The increasing importance of asset refinance Ric Simmons Sales Director Praetura Asset Finance

M

uch is made about the benefits of asset finance allowing businesses to invest in new equipment or upgrade vehicles to enable growth. But what isn’t highlighted, perhaps as often as it should be, is when asset finance can provide a valuable lifeline too.

A notable example of this, was a haulage company Praetura Asset Finance was proud to be able to help recently. The company was a well-established, family-run firm who had found themselves in arrears to the tune of over £1 million with HMRC. They had trusted in the staff looking after their invoicing and accounting, but it emerged that over a five-year period (beginning in 2009), this hadn’t been done correctly. Quite the opposite in fact, hence the substantial arrears.

A deal had been struck with HMRC for the debt to be repaid in installments of £10,000 per month. Whilst obviously straining the company’s cashflow, this was being managed and the solution seemed to be working well for both parties.

That was until they suddenly received word from HMRC that the outstanding balance was to be repaid in full, or a winding up order would be instructed. This meant the company now had a matter of weeks to repay £588,000, or face bankruptcy.

The banks they asked said no. The funders the company had finance arrangements with, or had worked with in the past, also said no.

But their local broker had the advantage of working with Praetura Asset Finance; a consultant lender that doesn’t just look at the numbers on a balance sheet when making a decision: “Praetura had the sense and expertise to look at the wider picture,” the broker told us, “they could see that the business was asset rich, but cash poor and took the time to tailor the solution to exactly what the client requested.”

The deal was complicated, as it ended up involving the refinance of 67 trucks and trailers, with a wide variety of ages, some of which had existing finance in place which needed to be settled. The vehicles 18 | NACFB

were in a range of locations, yet all had to be valued and inspected.

Plus, charges on two properties were also incorporated to bridge the security gap, which meant solicitors being added to the mix too.

Meanwhile, Praetura’s credit director and the broker’s business development manager flew out to spend a day with the broker and his client. During which they learnt more about the business, the history, how they were coping and what their plans for the future were. They were also able to take the owner in detail through what a refinance arrangement of this scale would entail and how it could be structured in the best way possible to suit their needs.

The funding was split over two agreements, with 25 of the older vehicles funded over 36 months and 32 newer trucks and trailers refinanced over a five-year term, with extra security taken via a charge on property for each deal.

With a High Court date set (which would start proceedings to potentially close the whole business), there were deadlines to adhere to. HMRC were paid the entire £588,000 owed directly

by Praetura four days ahead of schedule.

For so long this business had been fighting against the tide, just to keep their heads above water. They can now look to the future and take the company forward to bigger and better things.

Many other funders had said no, without taking the time to understand the client or their situation. But that’s not how we work at Praetura; we’re here to work in partnership with the broker and their client, to look at all the available options and tailor the solution in a way which solves the issue. In fact, without wanting to blow our own trumpet, it’s something of a specialty of ours!

“

HMRC were paid the entire £588,000 owed directly by Praetura four days ahead of schedule

“

The deal was complicated, as it ended up involving the refinance of 67 trucks and trailers, with a wide variety of ages, some of which had existing finance in place which needed to be settled

Refinance is becoming an increasingly popular option for SMEs throughout the UK and we expect this trend to continue in 2019.

These are uncertain times, we do not know what the rest of 2019 is going to bring and there are many who feel we’ve been in limbo for quite some time. But this shouldn’t be used as an excuse to hamper the growth of small and medium sized businesses up and down the country.

Instead, we should be encouraging more of them to look at the assets within their

businesses and ask what they could do if they were able to convert the equity held in those assets, into cold hard cash. Then we give them the keys to unlock that potential, by letting them know the options that asset refinance can make possible for them.

Whether funds are needed to repay debts, to consolidate, to inject working capital into their business to improve their cashflow, or allow new avenues to be explored, new premises to be purchased, more staff employed or to invest in new machinery: asset refinance can help.

NACFB | 19

Case Study

Financing the whole business The return of the traditional bank-lending model Nigel Das Business Loans Bank and Clients

T

he 2008 credit crisis, and the resulting curtailing of lending to mainstream UK sectors, was largely addressed in the decade that followed. New debt funds exist for commercial property, the UK residential mortgage market has developed a range of new products, and there has been an emergence of peer-to-peer lenders for borrowers willing to pay their rates.

One sector that hasn’t quite recovered from the shock is that of funding for small and mid–sized businesses. According to the SME Finance Monitor the majority of SMEs between 10-49 employees surveyed used overdrafts (26%), credit cards (26%) and asset-backed facilities (36%) for funding. This suggests that SMEs might be underfunded and struggle to raise finance against non-hard asset collateral.

Our approach to lending is to ‘finance the whole business’, meaning that we don’t specialise in niche aspects such as pure cashflow lending, or lending against hard machinery or receivables: we lend against every aspect of the business, looking at its profitability and quality of management. As well as understanding their own business dynamics, the business borrower also has to understand debt – why they might want a fixed rate versus floating, and how much equity they ought to have to absorb shocks.

Few other banks appear to share this philosophy. A reflection of this is that the British Business Bank’s online Finance Hub – designed to highlight source of funding for SMEs – tends to point businesses towards equity funding where no tangible asset collateral is available.

20 | NACFB

There’s a logical explanation for this approach – under the lending rules of both the mainstream and challenger banks, risk is perceived as being reduced when backed by invoices, inventory, machinery, property or a personal guarantee.

We were approached by the purchaser of a well-established B2B service business in the Midlands. They planned to provide £2 million of the funding requirement and had an invoice discounting facility of £2.5 million and wanted to know if we would bridge the gap for a further £2.5 million. We didn’t see the reasons to separate the funding into these two facilities at very different rates. Instead, we provided terms to them for the entire £5 million four-year term loan acquisition facility, at a rate which blended their CID facility rate with that of a cashflow loan. This provided a one-stop solution, with competitive pricing, and greater flexibility for the client.

The UK has one of the most prominent SME sectors in Europe; we think these businesses should be funded in the same way as larger companies, with single facilities which allow for the greatest flexibility.

“

We don’t specialise in niche aspects such as pure cashflow lending, or lending against hard machinery or receivables: we lend against every aspect of the business

MFS delivers fast bridging loans for new-build investments: Free valuations Broker incentives Zero admin fees No charge for early repayment

Contact our award-winning team on 020 7060 1234 to arrange a meeting with one of our Business Development Managers

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Patron Profile

Evolving with the SME market Richard Doe Managing Director of Commercial Lending Paragon

P

aragon’s background may be as a specialist lender focussing on Buy-to-let mortgages, but in recent years we have expanded our financial services further to include a Commercial Lending division along with establishing a bank, which has led to award-winning savings products.

The Commercial Lending division, which includes asset finance, motor finance, structured lending and development finance, is going from strength to strength; to the extent that the division reported the largest increase in profits across Paragon Banking Group in its latest full year results. There was a 41% increase to £20 million compared to the same period last year while new lending in the division was up by 83% to £710 million in a year.

At the heart of Commercial Lending is our Asset Finance team, which has quickly made a name for itself as a specialist SME funder with the scale and expertise to support the breadth of the SME community.

The team even picked up the title of SME Specialist of the Year at the Leasing World Awards 2018 in November.

Whilst I, Richard Doe, managing director of commercial lending at Paragon, head up the division, the day-to-day responsibility for asset finance falls to Gary Leitch, managing director of asset finance.

The key people in Gary’s team include asset finance sales director Tim Biddle, head of credit management Anup Sangha and Jan Greenhalgh, the head of new business management. Their focus is to provide 22 | NACFB

a more consistent and faster service to get the deal right first time, particularly to the 100 commercial brokers or so we serve.

Together, the team is working to improve access to funding for British companies, particularly small and medium sized businesses, to help them achieve their financial ambitions and fully support the entire breadth of the SME credit spectrum. The aim is to act as a ‘one stop shop’ for businesses, whether it’s someone self-employed to a mid-sized company, especially as our asset finance products through broker channels have been continuously developing.

Products now span a wide range of business areas from manufacturing to printing, business equipment, technology, media, aviation, construction, transportation and legal practice finance.

There is also working capital funding for SMEs through invoice discounting and factoring, while through a direct model, businesses

“

There was a 41% increase to £20 million compared to the same period last year while new lending in the division was up by 83% to £710 million in a year

“

Despite uncertainties, we are still seeing a need for funding and the greatest increase in investment seems to be in the IT sector

can benefit from services in industries including construction, agriculture, commercial transportation and professions.

For 2019, Paragon is expanding its proposition further by also financing soft assets, to add to its existing support for traditional hard assets.

It’s a move that reflects the evolving world of British businesses in the 21st century and a way that we can get more funding to the SMEs that need it. Soft assets will include a broad range from IT and office equipment to medical equipment and commercial fitouts or refurbishments. This reflects how asset finance is moving gradually from standard hard assets associated with factories and workshops to a huge growth in soft assets like software, shop fittings and office furniture.

As a specialist SME lender, a deal with Paragon can support either prime or near-prime, extending credit to support those businesses with a more modest financial performance. In addition to quite straightforward financing requirements, it can often be something complex or structured which we support and which high street banks won’t typically accommodate.

Our experienced team thrives on complexity, which can often be

found in “storybook loans” or longer structured refinancing deals.

A detailed review is completed using Paragon’s own valuations and underwriters to create specialist deals and extra time is taken, where necessary, to understand the businesses we are dealing with, so we can tailor the financial support it needs.

We have been investing heavily in adapting our processes, developing our ways of working and the technology that underpins it so that we can provide the rapid support necessary in the SME market.

We recognise the skill and expertise that the broker community offer to SMEs up and down the country and this is reflected in the disproportionate growth of this distribution channel over recent times.

We stand ready to provide our service to that increasingly important segment of the market.

Despite uncertainties, we are still seeing a need for funding and the greatest increase in investment seems to be in the IT sector.

We expect our soft asset financing proposition to be able to support that demand. It’s not the only area though as we have seen uplifts across most of the industries we’re involved with and that includes sectors like manufacturing, plant hire, construction and transport.

We believe there is a lot to be encouraged about in the coming year.

NACFB | 23

Compliance

Greater than the sum of our parts The continued importance of the Association’s Minimum Standards Review

Testimonials

“

‘A really useful meeting for all of us and we appreciate you taking the time to advise us on what the next steps would be if we choose to go down the regulated route.’

“

‘I found it very helpful and reassuring.’

Commercial Mortgage NACFB Member

“

‘The visit was informative, and it is good to have a fresh pair of eyes looking at the business to give us an objective overview.’

NACFB Member

NACFB Member

Erica Meredith Compliance Consultant NACFB Compliance

O

ccasionally in your working environment you meet a person who inspires confidence by approaching their responsibility with such insight that their words and deeds stay with you. You may be surprised that in this case the person in question was an internal auditor. What he shared with me was this: “Treat me as a business partner. I am not here to find fault, I am here to help you run your business.”

He was good to his word and remained, for many years, a colleague whose counsel I sought.

I mention this because there are parallels with the Minimum Standards Reviews which we have been undertaking for the last three years. Just in case you haven’t experienced a review, let me paint a picture of what they involve.

We take time to understand your business, the source of your introductions and the process you implement to join borrower and lender. We step through the client and customer journey with you and review the processes and documentation that you use in your business.

We also discuss your general business policies and procedures to understand how you manage your operation and the consequent impact on your customer. Please be assured that this does not involve actual file reviews because we assume that you will not have your customer’s permission for such an exercise.

Reflecting on the agenda of a business partnership, our aim in undertaking these reviews is to help you run your operation.

We have a model office with over 60 standard business forms against which we can compare your documentation. We have already visited over 500 Member firms and we have observed examples of best practice across a range of operations large and small. Knowledge management is a great example of how we can add value to your business.

We simply can’t ignore regulation in our sector, which now presents itself in many guises and part of our review agenda is to make sure your business doesn’t unwittingly fall foul of the rules by which it should adhere.

This is probably a good place to think about the Association’s mission statement and judge whether our review activity aligns with our direction of travel.

foster professional expertise. Our aim is to help brokers embrace the highest industry and regulatory standards, including engagement with our stakeholders, to help your business prosper.

Our aim is to make sure we use the review, and consequent observations, to ensure your business is run as professionally as possible – as well as conforming to all the elements of regulation that apply to your operation.

Our Patrons, who are vital stakeholders, show an extremely keen interest in the fact that there is a level of oversight of both regulatory and professional performance which is evidenced in the high-level results and general direction of travel.

The additional assurance that we are able to deliver serves only to help our Members prosper so it feels to us that this activity is driven straight from our mission.

And the benefits don’t stop there. Part of the agenda is to promote the quality of this industry to the wider business finance and regulatory community. It will come as no surprise that the FCA show a keen interest in this element of what we do and all the time that we can demonstrate that we are working hard to deliver a level of oversight, they might just accept that this is all that is required. Afterall we are, by comparison, a small sector on which to deliver regulatory oversight.

We are also passionate advocates of the professionalism of our Members and the results of this activity also provides us with supporting evidence when engaging with other stakeholders such as the Bank of England and British Business Bank.

In closing allow me to share one piece of best practice which may be useful. There does appear to be a recurring theme that some of our Members are not keeping much evidence of their dealing with their clients. Whilst there is plenty of activity being discussed, we have a concern that it is not recorded appropriately.

If there is some degree of misunderstanding or dispute in the future, your evidence will be invaluable in being able to demonstrate that you performed your responsibilities diligently and within the regulations in place.

I hope that I have been able to share the benefits of a visit with you.

We are embarking on a programme of visits in 2019 and I extend an invitation to all our Members to contact the compliance team if you would like to reap some of the benefits that I have been discussing.

“

We take time to understand your business, the source of your introductions and the process you implement to join borrower and lender

The NACFB’s mission remains to partner with our Members to NACFB | 25

Ask the Expert

Keeping brokers covered in 2019

Q Stuart Brierley Cert CII Managing Director Towergate Hull

For those new to commercial finance, what is Professional Indemnity (PI) insurance and why is it important that our brokers have this cover?

It is a type of liability insurance that covers the cost of compensation that brokers have to pay to their clients if their clients lose money as a result of an error or negligent advice given by the broker. It protects the broker’s financial position and also gives lenders and clients the assurance that the brokerage is a professional business that takes their obligations seriously.

Can you provide an example of where PI cover has helped a commercial broker?

A number of brokers have been compensated for money that has had to be re-paid to their clients following the mis-selling of PPI over the past few years.

Another example is where a client had to pay an early redemption fee that hadn’t been explained to them by their broker and was able to recover the cost of this from the broker who, in turn, was compensated under their Professional Indemnity insurance.

26 | NACFB

&“

What is 'run off' cover and should our brokers consider this?

Unlike most other forms of insurance, Professional Indemnity insurance is arranged on a ‘Claims Made’ basis – this means that the insurance policy has to be in force at the time a claim is made; it is not sufficient for the policy to have been in force at the time the advice was given.

So, if someone decides to retire, they will need to keep their policy in force to continue to protect them for any claims which may be brought by their clients in the future. Under UK law, you have up to six years to bring a claim for financial loss and, as such, it is usual for run-off cover to be purchased for up to six years.

to pay out has risen from £150,000 to £350,000. Will brokers be protected against this rise?

A

What's the difference between an 'any one claim' and an 'aggregate' policy?

If a policy limit is ‘any one claim’ it means each claim made under that policy can be covered up to that amount. If the limit is ‘in the aggregate’ then it means that limit is the most that will be paid for all claims added together during that twelve-month period of insurance.

With the FCA increasing SME access to FOS, the maximum amount of compensation they can require financial services firms

Like any contract, the PI policy doesn’t cover everything but, if the FOS uphold a complaint which evidences that the broker has made an error or given negligent advice in respect of an aspect which is covered under the policy, then the PI policy will protect the broker, up to the limit that the broker has bought.

A number of brokers have been compensated for money that has had to be re-paid to their clients following the mis-selling of PPI over the past few years

We value our long term relationships Close Brothers has a well-documented history of lending through all economic cycles.

We can only do this because of the strong relationships we have with our brokers and customers, who know they can expect consistency at all levels.

Contact our team today to find out how we can support you with asset finance options.

0330 134 6400 broker.support@closebrothers.com

Close Brothers Business Finance is a trading style of Close Brothers Limited.

Close Brothers Limited is registered in England and Wales (Company Number 00195626) and its registered oďŹƒce is 10 Crown Place, London, EC2A 4FT.

Special Feature

Advertising Feature

By partnering with introducers, we help each other go further Tom Shave Head of Broker Funding Circle

T

he role of introducers at Funding Circle is as important now as it ever has been. Our partnership with brokers across the UK has been central to our growth for many years, helping us achieve milestones such as reaching £1 billion lent through our introducer channel.

The channel continues to grow significantly too, reaching +50% YOY growth in 2018 and now represents 28% of our originations in the UK. With such a valuable contribution, we’re not only dedicated to our existing introducer base, but are determined to grow the channel further and provide an even better service going forward.

The core of our success When it comes to the introducers we work with, the success of our relationship comes from a shared ethos – helping small businesses get the funding they need to thrive.

Many brokers we work with have been able to expand by offering their clients a new product alongside asset finance or property, some even adding whole teams dedicated to unsecured or cash flow lending. Likewise, it helps us reach more businesses than we would with our direct channel alone. Without our introducers, we’d struggle to reach those who prefer face-to-face meetings or want financial advice, or otherwise wouldn’t be comfortable applying via our website.

The long-standing relationships between broker and client are also hugely important to us. For small businesses to flourish, they need trusted advisors that can help them on their journey. Financial support at key business stages can save or accelerate a business, and we’re proud to be an option that introducers want to recommend to their clients.

How we’re working even closer together Our experience has taught us that the best way to drive value for 28 | NACFB

both us and our introducers, is by working closer with them than ever before. By offering a more integrated service, introducers can provide a better service, we gain more business, and ultimately clients get the right funding for their business. It’s a win win win.

To achieve this, over the years we’ve enhanced our introducer service to make it as straightforward as possible to find solutions for their clients. We’ve taken direct feedback from our broker community on how to develop our product, leading to a reduction in credit assessment time and ultimately time to payout.

We’ve changed to a regional structure to better serve the market, begun joint marketing campaigns, referral of third-party introducers, and developed our Business Champion programme, which rewards brokers of all sizes that demonstrate high levels of efficiency and quality.

We support our introducers’ growth by offering a free marketing service, helping ensure their customers come back to them first for further loans. In 2018 alone, this service is estimated to have helped the customers of these introducers access an additional 20% in lending. We’ve also co-hosted regional events to promote their services even further.

Our vision for the future We want to be the first choice for small business finance that introducers recommend to their clients. We’re going to continue investing more in our service to get there, so we’re expanding our team of BDMs with additional headcount in localised regions.

We’re further opening up our internal resources to introducers, evolving our marketing support and providing data analytics expertise to help them reach more customers and build their brands. We’ll also be streamlining our documentation processes to speed up applications and creating a hub to manage applications and provide information and insight into their customer base.

We are truly proud of what our introducer channel has achieved already and, with our ambitious plans for the future, we’re looking forward to helping our introducers fly in 2019 and beyond!

HELPING INTRODUCERS FLY Fast, affordable business loans to make your clients go further

Decision typically within 24 hours Dedicated Business Development Manager Get in touch today 020 3667 2208 | introducer@fundingcircle.com Funding Circle is authorised and regulated by the Financial Conduct Authority. T&Cs apply

For those made to do more

Special Feature

Technology to empower brokers Graham Toy, NACFB chief executive officer, reflects upon how brokers can embrace technology in 2019 Graham Toy Chief Executive Officer NACFB

T

echnology can simplify a broker’s life. Whilst technological developments are still viewed by some as a threat to the very act of broking; the technology itself should not be feared. Instead, it should be embraced by brokers as it can streamline, enrich and enhance the process of providing a business borrower with growth finance.

Terms such as fintech, automation, Open Banking and blockchain can appear daunting – abstract even – but technological progression in no way signals the end of the broker.

Trusting a hybrid approach A broker’s job should never be about collecting data or chasing for documents, the role of a broker is to talk to customers and understand their needs, and ultimately, help them to succeed.

There exists an array of tools on the market to help brokers gather borrower documents. Brokers can now ask their clients to sign up to an application, which automatically sends the borrower a fact find. Once completed, the information is sent back to the broker who now has all the basic information they need. The broker can then create a customised document checklist and send this off to the

“

The idea of a binary choice between human and machine is simply not realistic. Business models of the future, for client and intermediary, will involve a hybrid approach

customer to upload documents, take photos and keep the broker updated with progress.

The idea of a binary choice between human and machine is simply not realistic. Business models of the future, for client and intermediary, will involve a hybrid approach to advice that ultimately provides a better outcome for the borrower.

“The broker market hasn’t really seen much in the way of visible technology yet, other than the challenger banks introducing hubs and portals, that technology currently sits in the background and is largely invisible,” says broker Phil Gray, NACFB Board Director.

Phil envisions that as the technology starts to become more visible it will present challenges for both brokers and their clients: “…trust will be the major obstacle to the advancement of technology in finance and ultimately it will advance as quickly as clients begin to trust technologies such as Open Banking.”

The early adopters Some brokerages are already turning to technology to help their clients find access to finance. Jamie Stewart, director at Think Business Loans, spoke of the ThinkApp platform licenced by his team. The mobile app allows users to connect their business to a funding platform from a smartphone, allowing them to receive live business loan and finance offers at any time and without a credit check.

Jamie shared how the mobile app allows the borrower to remain updated, without the need to speak to an agent at every step of the journey: “Real time notifications mean the client can view their offers and accept there and then, before an agent has had a chance to pick up the phone.”

Even with such a progressive attitude to interaction management Jamie acknowledged the app’s limitations: “Tech is great for ‘filtering’

based on requirements and status, but we’ve found our clients still need to discuss their options, ask questions and consider a number of options that at present simply cannot be serviced by a table of results.”

“Some deals require a creative view which may result in a schedule of finance options over a longer period. It’s all about finding a balance with tech and human touch,” he added.

Working with lenders The commercial lending technological drive is still being led largely

by UK lenders. Matt Tooth, chief commercial officer at LendInvest, believes that technological solutions should be tapered into the funding process, and only where necessary: “In specialist lending people really matter, as the permutations in decision making mean that humans can always add value.”

“We take regular broker feedback and try to introduce technology at appropriate touch points where our clients find human intervention less necessary,” he added. “In future, we can expect to see more brokers accessing their lenders indirectly via sourcing systems or other broker CRM systems. Inputting source data once and then being able to forward that to different lending channels will become the norm.”

Steve Barber, managing director at BFS, recognises how large parts of the broker market remain one-man bands, where paper processing remains predominant, adding: “Many of the specialist finance products don’t fit sourcing systems because every deal is unique and is underwritten on its own merits – IT doesn’t lend itself well here because these are not commoditised transactions.

“Nothing beats the mark one human brain – this is still hugely relevant to the bridging market unlike standard residential mortgages that allow for a standard transaction, where much of the underwriting elements can be automated.”

NACFB | 31

“

Business borrowers, like most consumers, will increasingly start their journey on their mobile phones before switching to their laptop and only arrange a face-to-face meeting further down the line

Streamlining regulatory requirements James Hinch, compliance consultant at the NACFB, believes that technology can vastly reduce the regulatory burden and inefficiencies when submitting a broker’s Gabriel return.

James also shared how the NACFB is looking to technological solutions to help brokers with their anti-money laundering checks through SmartSeach. Offered at a discounted rate for the Association’s Members, SmartSearch is a: “Unique online platform that delivers searches and verifications on individuals and businesses across the UK and international markets.

“After scrutinising the market – and consulting with Members – we found SmartSearch’s platform was ideally suited.

SmartSearch uses data partners Experian, Equifax, Dow Jones and Companies House to conduct searches and checks on individuals and businesses both across the UK and the international markets,” he added.

James echoed a common sentiment and was keen to see balance maintained: “A compliance function needs more than just technology to work well, verbal and face-to-face communication skills remain vital.”

Enabling productivity growth It is not just brokers who are being encouraged to grasp new technology, SMEs are too. A government review published in late 2018 sought to encourage Britain’s 5.7 million small businesses to adopt basic technology such as cloud computing software with the aim of improving productivity.

The Business Productivity Review, which consulted thousands of bosses, identified huge splits in productivity between sectors and laid bare an output crisis. It urged SMEs to use products such as web-based accountancy software and supply chain management systems to boost growth.

32 | NACFB

Such drives are set to bring about wider cultural changes. Business borrowers, like most consumers, will increasingly start their journey on their mobile phones before switching to their laptop and only arrange a face-to-face meeting further down the line.

Broker adaptability Fundamentally the commercial market – and the broker make-up of the NACFB – remains a broad church. Technological solutions that work with the development and commercial mortgage broker will not apply to those operating in the asset or invoicing financing spaces. Everyone we spoke to shares the same view; whilst technology can streamline processes it will never truly replace the role of the broker – but brokers should at least be willing to adapt to technological advances – these will only serve to offer the borrower a greater plurality of choice.

Paul Goodman, NACFB Chair, believes that a client should always have choice in the journey: “If a client doesn’t value the personal interaction, then a web-based portal is the route for them. However, there should always be the option to speak to an experienced broker in that journey, should the options become too many and too confusing; which does happen all too often.

“There is still very much a place for the old fashion bank manager approach, being that trusted advisor in the community, the person to go to so to speak. Where the broker should embrace technology is in all aspects that make the customer, broker, and lender journey more effective and streamlined,” he added. “This way the process should be as painless as possible, transparent and the right outcomes delivered for the customer.”

Such progress is likely to have an increasingly large impact on the relationship between the client and intermediary. But brokers remain resilient and adaptable, and, backed by a forward-thinking and independent trade body like the NACFB, brokers will continue to provide their clients with the choice, the advice, and the expertise through whatever available platform.

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Special Feature

Don’t be daunted by valuations Steve Larkin Director of Development Finance LendInvest

A

date of valuation, taking into account the existing market conditions – it’s not going to factor in property price increases that may be speculated, for example.

The GDV figure will be key in any development finance application, since that’s the figure that lenders will offer their loans against.

t the start of a new year, it’s important for all of us within the property market to reflect on what went well in 2018 and how we can improve in the future.

Intermediaries know only too well that by developing their skills and understanding of different areas of property finance, they can deliver a more satisfying experience to their clients and boost their bottom line to boot.

So, for example, a lender may have not only a maximum loan to GDV, working much like the LTV on a traditional mortgage loan, but also a maximum single unit GDV. It’s crucial for advisers operating in this area of the market to have a good grasp on precisely what lenders are likely to accept when it comes to finance applications, so that they can better steer their clients towards lenders who are most likely to view the planned project in a positive light.

Ongoing professional development is a subject that we actively promote at LendInvest. As a lender, it’s vital that we help brokers to keep on top of what expectations are when it comes to submitting cases and ensure that they fully understand each part of the development process, and why it matters to us.

The residual method

That’s why we will be holding broker academies alongside the NACFB throughout 2019, both in London and regionally, so that we can arm brokers with the tools they need to deliver the best possible advice journey to their clients.

Understanding valuations Development finance is one area that increasing numbers of brokers are now dealing with. When it comes to development, understanding valuations is absolutely vital, and it’s a topic that we will be delving into fully during those academy sessions.

The topic encompasses a host of important terms for brokers to wrap their head around, but few are more integral than gross development value (GDV), though it’s something that isn’t always keenly understood by advisers.

The GDV also plays a part in the residual method of appraisal, which is generally seen as the best method of calculating value when it comes to development sites. The residual method establishes what is left when you subtract the costs of building and selling the developed units – and the developer’s profit – from the GDV. There are four main areas of costs that brokers should look out for when their client is putting together this calculation.

Firstly, there are the costs that come from acquiring the site itself.

These cover things like stamp duty, surveys, the various planning costs and potentially the money spent to demolish what is already standing on the site.

Then there are the construction costs – this needs to cover not just the money that will be spent on the base build, but also the contingency money set aside for those unexpected delays that arise on so many development projects.

The GDV is essentially what the final capital value of the development is likely to be, once it has been completed.

After that come the professional costs. These are the fees from the likes of any architects attached to the build, the quantity surveyors and project managers.

A key fact to bear in mind here is that this assessment is based on the assumption that if the development were complete as at the

Finally, there are the finance costs. This is of course where the broker will come into their own, advising the client on the lenders

34 | NACFB

who will not only deliver the right rates and watch out for in terms of arrangement and monitoring fees, but also deliver drawdowns at speed to avoid any project delays.

The valuation process may seem a little daunting to those new to development finance. However, brokers that have a firm grip on it can deliver real value to their clients by steering them through it and providing the sort of invaluable advice that only comes from a top-class intermediary.

Specialist is the new mainstream There was a time when advisers could get by, sticking simply to handling mainstream, vanilla mortgage deals. That has long since

passed, and thankfully many intermediaries are waking up to the opportunities presented by specialist lending, both in terms of providing a more rounded service to their clients but also in boosting their margins.

While all specialist lenders will have their own methods for assessing applications, and slightly different expectations in terms of the documentation you may need to provide, there are fundamentals that apply across the board.

Get up to speed on those and you’ll be able to deal not only with one or two specialist lenders, but place cases across a wide panel of firms competing in this space.

A bank of knowledge not simply a bank of money Our support for your broker business goes beyond finance. We can connect you with the right people, with the right knowledge, to boost your clients’ businesses and help them grow.

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NACFB | 35

Industry Insight

SME finance – past, present and future Stephen Pegge Managing Director of Commercial UK Finance

A

ccess to finance is a key issue for SMEs and one that has been much discussed in recent years. Last autumn marked a decade since the global financial recession of 2008, and the resulting shockwaves which spread across all areas of the UK economy and also affected the relationship between banks and SME customers with regard to funding.

As the UK economy came under pressure and economic growth dropped sharply, new bank lending to SMEs also fell – to a low of just over £38 billion a year after the crisis. Yet simultaneously demand from SMEs for bank finance also decreased as firms retrenched in difficult times.

In response the UK’s six largest banks set up the Business Finance Taskforce in 2010, as part of efforts to rebuild relationships and support economic growth. This was followed by a number of actions and initiatives, with some of the key initiatives remaining operational today.

The combination of these initiatives and a period of economic recovery in the UK – as well as the support of the government through monetary policy – led to a growth in demand for credit.

UK banks responded by increasing the gross annual supply of new loans from just over £38 billion post-crisis, to nearly £60 billion a year by 2015-2017. The additional “extra” new loans granted of about £20 billion a year have added up to a cumulative total at the end of last year of nearly £75 billion.

So where are we now?

Yet despite the increase in new bank lending to SMEs, figures show the stock of SME loans outstanding is lower in 2018 than in 2007/2008, at £154 billion as of June 2018, compared to £176 billion in June 2011. Meanwhile, the latest figures available show the outstanding stock of loans stood at £153 billion as of November 2018.

While this is sometimes attributed to banks turning down smaller 36 | NACFB

firms’ applications for finance, this is not supported by the figures. Our latest SME data for Q3 shows that loan approval rates remain high, with 69,980 new loans and overdrafts approved for a value of £7 billion in Q3 2018, with eight out of ten applications for finance approved.

In fact, there are a range of factors contributing to the decrease in outstanding SME loan stock. In part this is due to past events, with firms paying off loans at maturity, scheduled repayments and also write-offs.

In the face of ongoing economic uncertainty as Brexit draws nearer, firms are also continuing to build cash deposits, while demand for finance remains subdued and steady across the UK’s regions and sectors, suggesting that businesses are exercising caution.

SMEs who do choose to borrow are also increasingly looking to a diverse and wider range of suppliers for external finance.

This reflects the ever-increasing choice in the market and the increasing willingness of SMEs to consider emerging sources of funding and types of product, many of which are also underpinned by fintech developments.

For the last three decades levels of finance provided to businesses through invoice finance and asset-based lending have been increasing and, since the recession in particular, they have become a mainstream source of funding for many businesses. The products can be particularly useful for SMEs, with many smaller firms wanting to unlock the cash tied up in working capital. Invoice finance and asset-based lending can help make firms’ cashflow more predictable and can offer protection against poor payment practices. The recent enactment of legislation to neutralise so-called ‘ban on assignment’ clauses will open this up to even more businesses.

“

Figures show the stock of SME loans outstanding is lower in 2018 than in 2007/2008, at £154 billion as of June 2018, compared to £176 billion in June 2011

So, what lies ahead?

Predicting the future is always difficult, never more so than at present with the uncertainty around Brexit. The subsequent economic outcomes will determine in part what happens to the SME funding landscape, but only in part. Business sentiment and confidence is key, but this is not always entirely dependent on economic growth. Put simplistically, even with a less buoyant economic environment over the short-term, we could still see a growth in demand for external finance.

While it is inevitable that a small number of businesses may struggle to access funding, there may also be some who hold back from applying for finance due to the perception they will not be successful. Whatever the outcome of the coming months, banks and the UK financial services sector as a whole have a key part to play in ensuring the development and continuation of the healthy SME funding market and that depends on confidence and trust.

“

For the last three decades levels of finance provided to businesses through invoice finance and asset-based lending have been increasing and, since the recession in particular, they have become a mainstream source of funding for many businesses

NACFB | 37

Industry Insight

Forging the path from broker to lender As a longstanding broker and twice Chair of the NACFB, what has David Whittaker learnt from the lending market and how has this experience helped inform the launch of Keystone as a full in-house specialist Buy-to-let lender?

Phil Riches Sales & Marketing Director Keystone Property Finance

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he significance and growth of the specialist BTL market since 2012 has seen a number of new lenders launch – including Keystone Property Finance – which over six successful years has completed over £400 million of loans through a partnership with Aldermore and Paratus.

Following the significant changes to the BTL market since 1st April 2016, David recognised as a broker that the current processing platforms used by other lenders were not agile enough to process and cover portfolio landlords, trading limited companies (including layered structures), EPC rules from April 2018 and the most recent changes to HMOs from 1st October 2018.

David took the decision to relaunch Keystone in September 2018 as a full in-house specialist Buy-to-let lender with him becoming CEO of Keystone and moving from being a broker to a lender.

Using his knowledge as a broker it was clear Keystone needed to include an instant AIP in the system to reduce the full data input which frustrates brokers on existing systems. The IT team worked closely with external software developers and brokers to build a cloud-based platform called MyKeystone. As it is an in-house system it is readily and rapidly adaptable to further broker requirements, market demands and regulatory changes.

The MyKeystone system will allow brokers to produce illustrations, complete just a short form to receive an instant AIP decision which then completes an EID check on the client. The system will automatically copy across the client’s information provided for the illustration and use it to start population of the full mortgage application fields. The system enables brokers to clone the full 38 | NACFB

mortgage application at any time if their clients ever wish to submit further or multiple applications.

David’s main focus when creating the system was what he and other brokers would like to see to speed up the application process.

Integration with the BTL Hub using e-Tech’s software to help assess portfolio landlord applications in light of the PRA changes under SS 13/16 was a market first and impacts approximately 40% of Keystone applications.

Brokers have always been invited to discuss their complex enquiries by discussing these with our highly experienced external and internal sales team, guiding them through the process and making the deals happen.

Broker feedback will be fundamental to our continued success in 2019; amongst the comments received from brokers on how we can improve has been a recognition that we will look at enquiries that others too readily ‘pass by’ which is one of the reasons that we are proud to be a specialist Buy-to-let lender.

The specialist Buy-to-let market is here to stay and will become a significant part of the overall lending market in 2019.

“

David recognised as a broker that the current processing platforms used by other lenders were not agile enough to process and cover portfolio landlords

“

David’s main focus when creating the system was what he and other brokers would like to see to speed up the application process

Broker Voice

Vigorous underwriting, a blessing or a curse?

Lenders are blaming historic loan books for longer completion times, but is this a bad thing?

Andrew Robinson Chief Executive Officer Arc & Co.

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ver the past two quarters, we have seen a marked trend in loans taking longer to complete. This has been a cause of frustration for both borrowers, whose transactions are often time sensitive, and lenders, keen to deploy funds. At first glance, the pattern seems strange and contrary to other observable trends in the market place.

Despite the slow completion times, we have continued to see impressive liquidity from established lenders, as well as a healthy stream of new lenders entering the market. This has included a large contingent of tech-savvy peer-to-peer lenders aiming to disrupt the mainstream market. However, there has also been a clear transition of many outfits, who would previously have been considered as straightforward bridge providers, who are now entering the development space in an attempt to grow their loan book.

Normally, in these competitive conditions, we would expect to see completion times shorten, however the converse seems to be true.

So, why the stagnation?

of strong comparable data in valuers’ reports as evidence to support developers’ sales plans. Today, however, lenders are focussing more diligently on both the length of the proposed sales period and the marketing activities of developers. They are also seemingly far more willing to challenge the comparable data within valuation reports and conduct their own equivalent due diligence.

The knock-on effect of this increased scrutiny is the added work required for both lenders and borrowers. Inevitably, as lenders undertake more due diligence, more problems are uncovered.

These issues must be rectified; and at the borrowers’ expense.

Often the result is a lower loan to value, requiring a greater equity injection, or the fulfilment pre-sales, which will bring down the overall GDV. Either outcome makes projects less profitable in terms of the return on investment. That said, whilst this short-term “curse” is clearly a headache, the long-term “blessing” is that the loans written today are likely to be much stronger and successful than those written in previous years.

Whilst this increased scrutiny might seem an unnecessary frustration for seasoned borrowers with successful models, for those with less experience or tighter profit margins, this oversight may well be the difference between a developer committing to a successful project or an unsuccessful and potentially painful one.

Increasingly vigorous underwriting

Market uncertainty

“Why do they need to know that?”

“That wasn’t an issue before.”

“Why is this taking so long?”

Brexit related worries, inconsistent housing policy and macro-economic headwinds are also clearly pulling the property market in different directions. This inconsistency is inevitably causing lenders, developers and third-party professionals to take a second and third look at details they may previously have considered unimportant.

As debt advisers sitting between principals, we are privy to the, often contentious, lender-borrower dynamic. The above quotes demonstrate the frustration borrowers are expressing at the increasingly vigorous underwriting process being conducted by lenders, who are asking questions they may not have asked a couple of years ago. Similarly, whereas previously a developer could perhaps expect a lender to waive certain immaterial conditions precedent before completion, today there is an insistence that each box is ticked and checked before a loan is drawn.

This new scrutiny seems to be driven by problems within lenders’ existing loan book. For example, an uptick in insolvencies among construction firms (in part, perhaps a ripple effect from the collapse of Carillion) has put contractors increasingly in the spotlight.

Background checks on balance sheet strength, relevant experience and a requirement for JCT contracts to be signed as condition precedent rather than a condition subsequent are all now the norm for lenders looking to spot potential problems before they arise.

Separately, weak sales for recently completed developments have clearly caused underwriters to increasingly probe the exit plans and marketing strategies for new and proposed developments.

A year or so ago, lenders were often happy to rely on the existence

Whilst, as a country, we are told that we need to build 300,000 new homes per year, the industry is not supported by a clear or consistent planning policy or tax system. For example, the latest increase in stamp duty for second properties – or properties owned in companies – has squeezed the margins of the small and medium developers who would be best placed to deliver the extra houses required.

Looking ahead Political uncertainty aside, we believe that the combination of improved underwriting and a competitive development finance market can only be a positive for clients in the long run.

Whilst we never want a transaction to take longer than necessary, we are confident that shrewd developers will rise to the top and establish lending relationships that allow them to do business at the required speed. At the same time, greater scrutiny will hopefully protect greener developers from making the mistakes that would have prematurely ended their contemporaries’ careers in years gone by.

NACFB | 41

Opinion

Helping UK businesses bridge the finance gap Graeme Fisher MD, Policy & Communications British Business Bank

A

dvisors to small businesses know that external finance can be the key to unlocking growth for their clients.

However, too often a ‘no’ from a finance provider can stop a small business in its tracks – the British Business Bank’s 2017 Business Finance Survey of SMEs found that 27% of smaller businesses who sought finance but did not get what they wanted, gave up, or cancelled their plans.

At the British Business Bank, we work to make finance markets for smaller businesses function more effectively, helping those businesses prosper and grow, in turn building UK economic activity.

We don’t lend or invest directly – but work with over 120 delivery partners to grow both the supply and diversity of finance available to smaller businesses across the UK. We have a number of programmes that enable the market to provide more debt and equity, and NACFB Members should be aware of our flagship programme supporting access to debt finance – the Enterprise Finance Guarantee (EFG).

EFG facilitates additional finance to smaller businesses that are viable but unable to obtain finance from their lender due to having insufficient security to meet the lender’s normal requirements. The programme does this by providing the lender with a government-backed 75% guarantee – potentially turning that ‘no’ into a ‘yes’. The guarantee is security provided to the lender and not the small business. As with any other commercial transaction, 42 | NACFB

the borrower is always responsible for repayment of the full value of any facility supported by EFG. EFG is one of the Bank’s most successful and long-standing programmes. Since its launch in early 2009, it has supported the provision of over 30,000 business loans to a value of over £3.2 billion – additional finance for business owners who otherwise would likely have been declined.

As well as continuing with programmes such as EFG, the Bank has recently undertaken two new important initiatives aimed at improving and strengthening SME access to finance markets.

We have put in place a new UK Network, a team with dedicated directors and senior managers based in all regions of England and the Devolved Nations. One of the core objectives of the UK Network is to develop a deep understanding of the business finance ecosystems in all parts of the UK, so that, ultimately, the Bank can improve its support to smaller businesses. A key aim for the Bank next year is therefore to embed the UK Network to identify and help to reduce regional imbalances in access to finance for smaller businesses, wherever they are.

The finance gap for small business is not simply a supply-side issue, however. On the demand side there remains a knowledge gap, with many small businesses being unaware of the full range of options available meaning their default option is often their main bank.

The Bank has worked to address this knowledge gap by developing products aimed at raising small businesses’ awareness of, and confidence in, the wide range of funding options in the market.

This includes the recently launched Finance Hub, in which the NACFB is a valued partner. The Finance Hub provides independent

and impartial information specifically aimed at businesses with growth ambitions. It sets out clearly their finance options, featuring short films, expert guides, checklists and articles from finance providers to help make their application a success.

The new site also features case studies and learnings from real businesses to guide businesses through the process of applying for growth finance.

The Bank sees this as an important initiative that has the potential to have a real impact on the prospects of these businesses which, ultimately, will translate into economic growth and job creation.

We therefore look forward to working with the NACFB and its Members to promote the Finance Hub and to address the knowledge gap among smaller businesses.

“

27% of smaller businesses who sought finance but did not get what they wanted, gave up, or cancelled their plans

Good things come to those who go and get them.

Help them make the most of every opportunity. Get your clients fast, competitive business loans with no set-up fees from esme.

Search “esme loans”

Applicant must be a sole trader or director of a UK Limited Company, actively trading for at least 18 months with a minimum annual turnover of £15,000 and over 18. A personal guarantee may be required. Fees apply. © Esme Loans Limited, company number: 10411077. Registered address, 250 Bishopsgate, London, United Kingdom, EC2M 4A

NACFB | 43

Opinion

Taking a step beyond Why both brokers and funders need to look beyond the numbers to find their true value Giles Cross Chief Executive Officer FOLK2FOLK

B

ecause we’re business people we focus on outcomes: a solid return on investment and a strong performance against target; a positive P&L; a sky-high net promoter score; an increasingly engaged workforce, the consistent fulfilment of customer promise and year on year delivery to shareholder expectation. To name but a few.

And we should. It’s a requirement. The outcomes we create are the measure of our value and our success.

We take pride in the creation of positive customer outcomes. Helping our customers access the funding they need to grow, develop and diversify their businesses to achieve their personal and professional goals is of huge value. It should never to be underestimated.

“Quantity and persistence will get you the outcomes that you need” – James Altucher

44 | NACFB

But when we look at our business outcomes, do we always measure ourselves properly? Are we looking in the right place? Do we understand our true worth within the world in which we operate? I’m not sure that we do.

In our assessment we must avoid being shortsighted. Whilst solid numbers, profitability and market leading metrics are desirable we need to look beyond our businesses, beyond our balance sheets and, indeed, our impact beyond the customer.

“We want to control our own destiny and take responsibility for our own outcomes” – Doug Ducey We could add and measure our movement toward greater corporate and social responsibility, improving employee wellbeing, our levels of charitable and community participation and, of course, our drive to be better and more sustainable businesses. A positive ‘Responsibility Footprint’ is a brilliant thing, something we should all aspire to.

Business has a massive role to play in driving positive social change and the more we apply ourselves to ‘good works’, the better.

A certain politician talked of a ‘Big Society’ in July 2010. My ears pricked up. It was fresh. Exciting. It was “true”: The State could no longer be relied upon to deliver the social outcomes we desired.

That instead we should look to ourselves and the collaboration of businesses, communities, charities and interest groups to drive both change and the agenda. Sadly, when challenged and questioned, the idea crumbled and disappeared whilst the need has grown ever bigger.

Whatever we do to consciously improve the environment around us is of huge importance and, of course, of massive value. However, I think the value is greater still and, rather perversely, derived not from what we do consciously, but simply from what we do every day. Our jobs.

The more successful our small and local businesses, the stronger the local economy and, ultimately, all benefit through greater inclusion, participation and improved opportunity and social mobility. Solutions to social ills are found. Our lives improve.

We talk about this all the time at FOLK2FOLK. We call it “FOLKONOMICS”, realising that our true value sits in the outcomes created simply by doing the day job, playing our part in the creation and maintenance of socially and financially successful rural communities. But this isn’t about us, FOLK2FOLK; it’s about all of us.

“If you just focus on producing good outcomes, all that other stuff sorts itself out” – Thom Tillis

We live in interdependent ecosystems, local and national, and these ecosystems need to thrive. For our ecosystems to thrive, the businesses within them must also, with access to finance being a vital ingredient to their success.

At the end of 2016, there were 5.5 million businesses in the UK. Over 99% were recognised as SMEs, employing up to 249 people.

5.3 million (96%) of these were “Micro-Businesses”, employing less than ten people but still accounting for 32% of employment and 19% of turnover.

Individually and collectively, we’re a vital part of our ecosystems.

Our principle value sits with what we do; and that value is real.

We should be mighty proud of that.

Of course, we don’t call them SMEs and Micro-Businesses, to us, they are simply ‘our customers’ – and their success is of vital importance to us all. Now, especially in these most uncertain of times, and in the future.

When we arrange funding for our customers, something brilliant happens. Jobs are created, talent is retained, and new people attracted to areas they otherwise would not have lived. Secondary and tertiary supply chains evolve, creating a further increase in demand for talent. And this goes on. There is a demand for new homes, house prices are maintained and increased and the need for improved connectivity, whether that be digital or physical, rises to the top of the agenda. Demand for school places increases as does the requirement for improved local services. And it still goes on.

“

We don’t call them SMEs and Micro-Businesses, to us, they are simply ‘our customers’ – and their success is of vital importance to us all

NACFB | 45

Opinion

P2P platforms remain a viable route to finance David Turner Chief Executive Officer Invest&Fund

R

ecently a number of press articles appeared relating to the performance of a P2P lender that went on to consider the wider ramifications for the sector.

The general tone and conclusion of these articles was fairly negative and seemed to suggest that P2P lending was problematic, high risk and manned by operators lacking in robust governance and risk controls.

We feel that the arguments put forward were rather one-sided and that well-run P2P companies have nothing to fear from greater regulatory scrutiny. All the projects that are offered on our platform have to pass a very significant process of due diligence, which we have outlined below to demonstrate how we go about assessing a potential property development project.

A key factor for us is that every opportunity is individually assessed and our due diligence, providing it meets our risk quality thresholds, is shared with our potential lenders so they have full transparency on the pros, cons, risks and mitigants of the transaction. This includes, for example, our independent valuation and monitoring surveyor reports as well as the Report on Title, i.e. our lenders have the ability to undertake a full assessment on top of Invest&Fund’s detailed analysis before deciding whether it is a project they wish to lend to.

Our Business Development Team is very experienced in residential property lending, with our head of borrower origination having 35 years’ experience in commercial banking. Similarly, our Credit Team is very experienced in the sector with our head of credit having 30 years’ experience in commercial banking including 20 years plus in commercial credit. This experience is very important in understanding the nuances of the sector and ensuring that a full assessment is made of the borrower’s and contractor’s experience and track record, the quality of the proposed product and its location supply and demand dynamics. Independent professional opinion is then obtained to add weight to our internal analysis. Credit policy is in place with our maximum appetite 75% loan to cost and 65% loan to gross development value for senior lending. This means that there is always a reasonable contribution to the project and therefore

46 | NACFB

a reasonable margin of comfort for our lenders in a downturn scenario. A first legal charge over the site plus a mortgage debenture and personal guarantees are all obtained to ensure we have adequate security and control.

Just as important is the ongoing monitoring of a project after the approval to lend. Our BDM team visit all development sites on a regular basis and in addition our independent monitoring surveyor (IMS) visits the site and undertakes a full review of progress, typically on a monthly basis, providing a detailed report to Invest&Fund covering what aspects are on track and also any slippage.

These reports are similarly shared with our lenders. All drawdowns for the development spend are subject to IMS certification.

Finally, our Credit Committee, chaired by our head of credit, is held monthly where the status of all development projects is reviewed with more detailed interrogation undertaken if there are any signs for concern. This rigorous ongoing monitoring means any potential problems are identified at a very early stage and corrective strategies are implemented on a timely basis with no bad debts suffered on any lending to date.

We are confident that the Invest&Fund model is working well for both lenders and borrowers and we hope that the business will continue to grow and succeed with your support. P2P lending is providing a valuable service in filling a gap left by the high street banks and we have a strong conviction that the sector is here to stay for the long term.

“

We feel that the arguments put forward were rather one-sided and that well-run P2P companies have nothing to fear from greater regulatory scrutiny

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Listicle

Top UK cities for entrepreneurs

S

tarting a business is tough.

More than half of UK start-ups don’t survive the first five years, with aspects like rental prices, utility bills, consumer demand, and poor cash management often getting the better of budding entrepreneurs.

For an SME choosing the right location is key and can be the difference between success and failure. Whilst London is often perceived as being the best location for a small business to flourish – the UK has many an option outside the capital. We’ve compiled a round-up of some of the best cities in which to establish an SME in 2019.

2. Liverpool

4. Belfast

Liverpool is fast-becoming the start-up destination of North West England with its active city centre, busy port, and growth opportunities. Science and biotech are one of Liverpool’s speciality areas with three science parks; Liverpool Innovation Park, Liverpool Science Park, and Merseybio.

The city attracts a high level of tourists; bolstered by its leading shopping centre Liverpool ONE; a £1 billion development.

The number of new businesses established in Northern Ireland continues to grow.

In contrast to all other areas of the UK, which saw overall reduction in new company formations, some 7,398 local firms were registered in 2017. Belfast’s rebranded Titanic Quarter was the focus of a £7 billion regeneration project that has yielded a visitor centre, a college campus and one of Europe's largest film studios.

1. Birmingham Famed for its world-class shopping and Balti-Triangle, the UK’s second city has an economy worth £24.8 billion. The second city has seen a growth rate of 19.2% in the last five years and is one of the largest city economies in the country. There were 17,473 new businesses set-up in Birmingham during 2016 – more than any other city outside the capital.

1 48 | NACFB

2 3. Edinburgh Whilst not known for its weather, Scotland’s capital city Edinburgh is home to some of the country’s leading science parks and research centres as well as a cluster of fast-growth businesses and emerging start-ups. 3,055 start-ups were established in 2016 alone, with entrepreneurs taking advantage of the city’s small size, providing easy access to other established firms.

3

5 5. Nottingham Nottingham is one of just six UK locations officially designated as a Science City, in recognition of its status as a world-leader in science and technology. Nottingham’s Enterprise Zone is at the heart of its scientific cluster. While an appealing location for start-ups, it’s worth noting that Nottingham also serves as a base for corporates such as Alliance Boots, Capital One, and Experian.

Why join the NACFB? The National Association of Commercial Finance Brokers (NACFB) is the flagship trade body for UK commercial finance brokers.

t. 020 7101 0359 e. admin@nacfb.org.uk a. 33 Eastcheap, London, EC3M 1DT

w: nacfb.org twitter: @NACFB linkedin.com/in/nacfb

Five Minutes With

Five minutes with: Simon Cureton Simon Cureton Commercial Director Esme Loans

Describe your role in ten words or less?

Bringing great solutions to light for SMEs needing funds.

If you were to start your own small business, what would it sell?

How do you think commercial lenders can improve client experience?

In your view what are the key elements to a successful deal?

It would sell a service rather than something physical.

Thorough research by the broker on its client, followed by prompt and clear provision of the requisite information into Esme’s online Application Wizard. Some of our brokers and their clients have benefited from a fully automated end-toend experience with loans of up to £50k being approved and funded in less than 30 minutes, with no manual intervention.

What recent professional accomplishment are you most proud of?

Understand the needs of both SMEs and commercial finance brokers and build solutions to suit. Make the borrowing process as simple and quick as it can be, as Esme has, through the clever use of cutting-edge technology to do the heavy lifting so that business owners can focus on the job in hand.

What’s the most common reason for turning away a deal?

Affordability. Although we would like to help as many SMEs as possible, the team at Esme is committed to responsible lending and lending large sums of money when the numbers just don’t stack up simply isn’t appropriate. Lender behaviour in this context appears mixed but Esme will not be deterred from doing what is right for the SME community.

50 | NACFB

Definitely building Esme Loans from start-up to become an established alternative lender. I was employee number five pre-launch so I have been there for the whole journey. I remember our very first loan offer and it’s fantastic to be part of the leadership team that’s driving the business to new heights every quarter.

What advice do you have for the modern commercial finance broker?

Focus on your people as they will drive your success, embrace change, embrace the digital/fintech revolution, don’t try to do everything yourself – partner with other firms where relevant – and put your clients at the heart of everything you do.

Where is your favourite place in the world?

It has to be Sydney, Australia – Coogee Beach to be precise. I have been lucky enough to live and work in several countries around the world and for the lifestyle, Sydney has it all.

What is the best live music experience you’ve ever had?

I’m going way back to my days at Sheffield University for this answer – probably watching Faith No More in their heyday.

I lived in Paris too for my third year at university and I saw some of the best DJs live there.

SPECIALIST LENDING SOLUTIONS REFURBISHMENT BUY TO LET

A new way for landlords to increase yield and capital growth Our Refurbishment Buy to Let product lets your customer take advantage of the flexibility of Bridging Finance with the surety of an exit onto a Buy to Let Mortgage once the property has been refurbished (providing there are no changes and the property meets the expected valuation following refurbishment). Take a look at our unique approach: One application, which we key for you One expert underwriter providing support for the entire case One valuer for both the bridge and Buy to Let Mortgage One conveyancer and discounted legal fees

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Registered office: 2 Charter Court, Broadlands, Wolverhampton WV10 6TD.

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