NACFB Magazine - September 2018

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Issue 62 September 2018

The magazine for the National Association of Commercial Finance Brokers

A mountain to climb The NACFB speaks to the UK’s first SME commissioner about brokers, funding options and supporting the backbone of our economy

In this issue

Obtaining full FCA authorisation NACFB Compliance breaks down what you need to know

Keeping the story straight

Majority of brokers frustrated with lenders’ inconsistencies

Unravelling complex cases

Common pitfalls when it comes to non-standard deals

SPECIALIST SECTOR FINANCE: AGRICULTURE | AVIATION | HEALTHCARE | MARINE | RENEWABLES | TAXI | TECHNOLOGY

Productivity.

Diversification.

Growth.

Welcome | NACFB A

ugust is typically a quieter month in our industry and is often a good time to plan ahead. Here at the NACFB, we kept our foot on the gas throughout August to ensure we put in place detailed plans for the rest of 2018 and beyond.

In addition to the range of sectorspecific events running throughout autumn (see page 9), we are pleased to be partnering with Credit Strategy to support the Commercial Finance Conference. The event will also host the NACFB AGM on Thursday 8th November (more on page 4).

The NACFB Gala Dinner and Awards Ceremony will be returning to the Park Plaza Westminster for the fifth year on 29th November.

A limited number of tables and individual seats remain for the event, which provides an opportunity to showcase and recognise excellence in the sector (more on page 6).

Whether your customer is investing to generate long-term productivity gains, diversifying into special breeds, food production or renewables, or simply seeking to protect cash flow whilst renewing critical equipment, speak to our specialist agriculture and renewables team today.

We are also running two major projects that will positively impact your membership experience. First, from January 2019 the NACFB Magazine will be brought in-house.

We are asking all stakeholders to support the magazine not just in the form of continued advertising, but also by sharing with us your expert insight, detailed knowledge and industry experience in the form of thought leadership (see page 4).

Together

Contact us today

0345 604 0975 agriculture@shawbrook.co.uk shawbrook.co.uk/agriculture

Second, we are overhauling our digital presence and the way that Members, Patrons and partners engage with us online. This project will see us develop an enhanced website and Member portal, bursting with benefits designed to meet the needs of the modern finance professional.

As ever, we approach all our future endeavours with Members’ best interests front and centre of our thinking, and we remain grateful for your ongoing enthusiasm, guidance and support.

Until next month, Graham Toy, CEO, NACFB

Graham Toy CEO NACFB

In this September issue NACFB News 4-6 In the news 8 Notes from our sponsor 10-13 How can the UK’s SME commissioner help UK brokers?

Compliance Update 14-16 Obtaining full FCA authorisation

Commercial Finance 18-19 Essential news bites

Top Story 20

Shawbrook predicts BTL market to stabilise by 2021

Introducing 22

Precise launches holiday buy-to-let offering

Case Studies

Special Features 36-38 Hope Capital CEO Jonathan Sealey on the importance of continuing to talk to 41-41 56% of brokers are frustrated with lenders’ inconsistencies 42-44 The view from Ireland

Industry Guides 46

Funding seasonal businesses 48-50 The most common errors in complex cases

Opinion & Commentary 52-54 Fintech - who’s getting it right?

56 Planning constraints vs SMEs 58 Lessons in artificial intelligence

24-25 Cashflow finance fills gaps in unpredictable sales pattern 26 Sale & HP back helps keep things moving 30-31 Supporting an early venture into Help to Buy

Patron Profile 32-33 Newable

Ask the Expert 34

Emma Hall, head of sales at GWlegal

For further information Kieran Jones, communications manager t. 020 7101 0359 33 Eastcheap, London EC3M 1DT Email: Kieran.Jones@nacfb.org.uk

ADVERTISING & EDITING: Medianett t. 0203 818 0163 www.medianett.co.uk

Vera Sugar, editor t. 0203 818 0171 71 Gloucester Place, London W1U 8JW Email: vera@medianett.co.uk

DESIGN & PRODUCTION: Carbide Finger Ltd t. 0845 812 8206

THIS ADVERTISEMENT IS INTENDED FOR INTERMEDIARY USE ONLY AND MUST NOT BE DISTRIBUTED TO POTENTIAL CLIENTS GC_BF_AGF_NACFBADVERT_201807_V1

NACFB Magazine | 3

SPECIALIST SECTOR FINANCE: AGRICULTURE | AVIATION | HEALTHCARE | MARINE | RENEWABLES | TAXI | TECHNOLOGY

Productivity.

Diversification.

Growth.

Welcome | NACFB A

ugust is typically a quieter month in our industry and is often a good time to plan ahead. Here at the NACFB, we kept our foot on the gas throughout August to ensure we put in place detailed plans for the rest of 2018 and beyond.

In addition to the range of sectorspecific events running throughout autumn (see page 9), we are pleased to be partnering with Credit Strategy to support the Commercial Finance Conference. The event will also host the NACFB AGM on Thursday 8th November (more on page 4).

The NACFB Gala Dinner and Awards Ceremony will be returning to the Park Plaza Westminster for the fifth year on 29th November.

A limited number of tables and individual seats remain for the event, which provides an opportunity to showcase and recognise excellence in the sector (more on page 6).

Whether your customer is investing to generate long-term productivity gains, diversifying into special breeds, food production or renewables, or simply seeking to protect cash flow whilst renewing critical equipment, speak to our specialist agriculture and renewables team today.

We are also running two major projects that will positively impact your membership experience. First, from January 2019 the NACFB Magazine will be brought in-house.

We are asking all stakeholders to support the magazine not just in the form of continued advertising, but also by sharing with us your expert insight, detailed knowledge and industry experience in the form of thought leadership (see page 4).

Together

Contact us today

0345 604 0975 agriculture@shawbrook.co.uk shawbrook.co.uk/agriculture

Second, we are overhauling our digital presence and the way that Members, Patrons and partners engage with us online. This project will see us develop an enhanced website and Member portal, bursting with benefits designed to meet the needs of the modern finance professional.

As ever, we approach all our future endeavours with Members’ best interests front and centre of our thinking, and we remain grateful for your ongoing enthusiasm, guidance and support.

Until next month, Graham Toy, CEO, NACFB

Graham Toy CEO NACFB

In this September issue NACFB News 4-6 In the news 8 Notes from our sponsor 10-13 How can the UK’s SME commissioner help UK brokers?

Compliance Update 14-16 Obtaining full FCA authorisation

Commercial Finance 18-19 Essential news bites

Top Story 20

Shawbrook predicts BTL market to stabilise by 2021

Introducing 22

Precise launches holiday buy-to-let offering

Case Studies

Special Features 36-38 Hope Capital CEO Jonathan Sealey on the importance of continuing to talk to 41-41 56% of brokers are frustrated with lenders’ inconsistencies 42-44 The view from Ireland

Industry Guides 46

Funding seasonal businesses 48-50 The most common errors in complex cases

Opinion & Commentary 52-54 Fintech - who’s getting it right?

56 Planning constraints vs SMEs 58 Lessons in artificial intelligence

24-25 Cashflow finance fills gaps in unpredictable sales pattern 26 Sale & HP back helps keep things moving 30-31 Supporting an early venture into Help to Buy

Patron Profile 32-33 Newable

Ask the Expert 34

Emma Hall, head of sales at GWlegal

For further information Kieran Jones, communications manager t. 020 7101 0359 33 Eastcheap, London EC3M 1DT Email: Kieran.Jones@nacfb.org.uk

ADVERTISING & EDITING: Medianett t. 0203 818 0163 www.medianett.co.uk

Vera Sugar, editor t. 0203 818 0171 71 Gloucester Place, London W1U 8JW Email: vera@medianett.co.uk

DESIGN & PRODUCTION: Carbide Finger Ltd t. 0845 812 8206

THIS ADVERTISEMENT IS INTENDED FOR INTERMEDIARY USE ONLY AND MUST NOT BE DISTRIBUTED TO POTENTIAL CLIENTS GC_BF_AGF_NACFBADVERT_201807_V1

NACFB Magazine | 3

NACFB | in the news Association news and updates for August 2018

Support the NACFB Magazine in 2019 From January 2019, the NACFB Magazine will be brought in-house and we will no longer be partnering with our current suppliers.

Issue 59

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A

Z

I

M A G June A 2018 Z I N M E A E for the National Association N The magazine of Commercial FinanceThe Brokers magazine

G

for the National

ers Finance Brok Commercial Association of for the National The magazine

Vs of bridging LT t?

The declinesha ckling the marke Sustaining or

Issue 60 July 2018

A

Z

I

N

E

Issue 61 August 2018

Association of Commercial Finance Brok ers

Mending the g ap

A GAME CHANGER

How can we sol ve

the £57bn pro

ductivity shortfa

ll?

We arrived at this decision for a number of reasons, chief among which was our desire to ensure greater editorial control while raising the bar for content in the form of high-calibre thought leadership.

As a non-profit trade body, the magazine is not designed to be an income generator for the association.

We want to elevate the publication and secure its position as a platform for the best industry insight from lenders and brokers alike.

We are asking all our stakeholders to support the magazine not just in the form of advertising, but also by sharing with us your expert insight, detailed knowledge and industry experience in the form of thought-leadership articles.

All thought-leadership pieces from NACFB Patrons and brokers will remain at no cost, although more overtly advertorial and self-

Join us at the Commercial Finance Conference 2018 The NACFB is partnering with Credit Strategy to support the Commercial Finance Conference, which will also host our AGM on Thursday 8th November.

The Commercial Finance Conference will form one of three strands at the Lending Summit 2018, hosted a London’s Hilton Bankside. The Lending Summit is the UK’s first 360-degree forum for senior professionals and advisers in

4 | NACFB Magazine

In this issue

In this issue

Rising interest rates impact on The potential small businesses

Funding the North

What could with Manchester do £100m?

Professional indemnity insurance

In this issue

ing Midlands’ GDPR and brok moment

view on The NACFB’s s is how the proces Why it’s necessary and changing how it supports brokers

Asse

MEES

t finance How a bridging loan trends can help Is the region becoming How is the sector one of the leading influenced by reality TV? services hubs in the UK?

promoting pieces will incur a fee as outlined in the rate card.

NACFB Patrons will receive a reduced advertising rate and we have inbuilt flexibility within the rate card for longer-term contracts.

The NACFB Magazine offers unrivalled access to a captive market of the UK’s commercial finance broker market and we are calling upon you, as the UK’s most dynamic finance professionals, to join us on this journey and guarantee the continued success of the magazine.

Open Banking

The initiative that could change the market’s approa ch to finance

Millennials

Where is the young generation investi er ng?

Find out how you and your organisation can be a part of the new NACFB Magazine by reaching out to the team via the below contact details: Advertising e: magazine@nacfb.org.uk t: 0845 0043 169 Editorial e: kieran.jones@nacfb.org.uk t: 020 7101 0359

the consumer, commercial and corporate lending spaces.

Delivering business-critical intelligence and market insight, competitor benchmarking and highlevel peer networking, the summit will explore and delineate the new lending ecosystem and innovations in product origination, credit risk assessment, contact strategies, fintech and AI. The Commercial Finance Conference’s agenda will feature guest speakers, panel sessions and host the NACFB’s AGM. Find out more and book your attendance at an exclusively discounted rate for both NACFB Members and Patrons via NACFB.org.

Strategic insight for consumer and commercial finance professionals

Let’s run the numbers.

Find out instantly how much your client could borrow with our Buy-to-Let calculator.

8th November 2018 Hilton London Bankside London Call us on 020 3846 6838 or visit intermediaries.lendinvest.com/calculators. LendInvest Limited is registered at 8 Mortimer Street, London, W1T 3JJ (Company 08146929). ICO number ZA179467. Your client’s property may be repossessed if they do not keep up repayments on their mortgage. For intermediaries only.

NACFB | in the news Association news and updates for August 2018

Support the NACFB Magazine in 2019 From January 2019, the NACFB Magazine will be brought in-house and we will no longer be partnering with our current suppliers.

Issue 59

M

A

G

A

Z

I

M A G June A 2018 Z I N M E A E for the National Association N The magazine of Commercial FinanceThe Brokers magazine

G

for the National

ers Finance Brok Commercial Association of for the National The magazine

Vs of bridging LT t?

The declinesha ckling the marke Sustaining or

Issue 60 July 2018

A

Z

I

N

E

Issue 61 August 2018

Association of Commercial Finance Brok ers

Mending the g ap

A GAME CHANGER

How can we sol ve

the £57bn pro

ductivity shortfa

ll?

We arrived at this decision for a number of reasons, chief among which was our desire to ensure greater editorial control while raising the bar for content in the form of high-calibre thought leadership.

As a non-profit trade body, the magazine is not designed to be an income generator for the association.

We want to elevate the publication and secure its position as a platform for the best industry insight from lenders and brokers alike.

We are asking all our stakeholders to support the magazine not just in the form of advertising, but also by sharing with us your expert insight, detailed knowledge and industry experience in the form of thought-leadership articles.

All thought-leadership pieces from NACFB Patrons and brokers will remain at no cost, although more overtly advertorial and self-

Join us at the Commercial Finance Conference 2018 The NACFB is partnering with Credit Strategy to support the Commercial Finance Conference, which will also host our AGM on Thursday 8th November.

The Commercial Finance Conference will form one of three strands at the Lending Summit 2018, hosted a London’s Hilton Bankside. The Lending Summit is the UK’s first 360-degree forum for senior professionals and advisers in

4 | NACFB Magazine

In this issue

In this issue

Rising interest rates impact on The potential small businesses

Funding the North

What could with Manchester do £100m?

Professional indemnity insurance

In this issue

ing Midlands’ GDPR and brok moment

view on The NACFB’s s is how the proces Why it’s necessary and changing how it supports brokers

Asse

MEES

t finance How a bridging loan trends can help Is the region becoming How is the sector one of the leading influenced by reality TV? services hubs in the UK?

promoting pieces will incur a fee as outlined in the rate card.

NACFB Patrons will receive a reduced advertising rate and we have inbuilt flexibility within the rate card for longer-term contracts.

The NACFB Magazine offers unrivalled access to a captive market of the UK’s commercial finance broker market and we are calling upon you, as the UK’s most dynamic finance professionals, to join us on this journey and guarantee the continued success of the magazine.

Open Banking

The initiative that could change the market’s approa ch to finance

Millennials

Where is the young generation investi er ng?

Find out how you and your organisation can be a part of the new NACFB Magazine by reaching out to the team via the below contact details: Advertising e: magazine@nacfb.org.uk t: 0845 0043 169 Editorial e: kieran.jones@nacfb.org.uk t: 020 7101 0359

the consumer, commercial and corporate lending spaces.

Delivering business-critical intelligence and market insight, competitor benchmarking and highlevel peer networking, the summit will explore and delineate the new lending ecosystem and innovations in product origination, credit risk assessment, contact strategies, fintech and AI. The Commercial Finance Conference’s agenda will feature guest speakers, panel sessions and host the NACFB’s AGM. Find out more and book your attendance at an exclusively discounted rate for both NACFB Members and Patrons via NACFB.org.

Strategic insight for consumer and commercial finance professionals

Let’s run the numbers.

Find out instantly how much your client could borrow with our Buy-to-Let calculator.

8th November 2018 Hilton London Bankside London Call us on 020 3846 6838 or visit intermediaries.lendinvest.com/calculators. LendInvest Limited is registered at 8 Mortimer Street, London, W1T 3JJ (Company 08146929). ICO number ZA179467. Your client’s property may be repossessed if they do not keep up repayments on their mortgage. For intermediaries only.

NACFB NEWS

NACFB Gala Dinner: Thursday night at the movies The NACFB Gala Dinner and Awards Ceremony will be returning to Park Plaza Westminster for the fifth year on 29th November 2018.

#LendingSummit

Strategic insight for consumer and commercial finance professionals

The event commences with a drinks reception at 6.30pm, followed by a three-course meal and the awards ceremony. Afterwards, we’ll be running our usual afterparty with live music and entertainment – this year’s theme is ‘A Night at the Movies’.

Ticket prices are £310+VAT for an individual seat and £3,100+VAT for a table of 10. Find out more and secure your place by emailing info@NACFBEventServices.co.uk

Join us this November at the Commercial Finance Conference 2018 The NACFB is partnering with Credit Strategy to support the Commercial Finance Conference which will also host our AGM on Thursday 8th November.

The NACFB welcomes our new compliance consultant We are delighted to announce the appointment of Erica Meredith to the NACFB Compliance team. Erica spent 10 years in corporate banking and the financial markets, and brings with her experience in risk, compliance and audit. Erica’s main responsibility will be to further enhance the NACFB’s field compliance support across the UK. Her appointment strengthens the NACFB’s commitment to raising professional standards across the sector as we continue to build the association as a kitemark of quality that can be trusted in the SME and commercial lending markets.

The Commercial Finance Conference will form one of three strands at the Lending Summit 2018 hosted at London’s Hilton Bankside.

The conference’s agenda will feature guest speakers, panel sessions and host the NACFB’s Annual General Meeting.

Exclusively discounted rate for both NACFB Members and Patrons.

creditstrategy.co.uk/events Sponsors

Event supporter:

Helping Fund UK Business

6 | NACFB Magazine

Hosted by:

NACFB NEWS

NACFB Gala Dinner: Thursday night at the movies The NACFB Gala Dinner and Awards Ceremony will be returning to Park Plaza Westminster for the fifth year on 29th November 2018.

#LendingSummit

Strategic insight for consumer and commercial finance professionals

The event commences with a drinks reception at 6.30pm, followed by a three-course meal and the awards ceremony. Afterwards, we’ll be running our usual afterparty with live music and entertainment – this year’s theme is ‘A Night at the Movies’.

Ticket prices are £310+VAT for an individual seat and £3,100+VAT for a table of 10. Find out more and secure your place by emailing info@NACFBEventServices.co.uk

Join us this November at the Commercial Finance Conference 2018 The NACFB is partnering with Credit Strategy to support the Commercial Finance Conference which will also host our AGM on Thursday 8th November.

The NACFB welcomes our new compliance consultant We are delighted to announce the appointment of Erica Meredith to the NACFB Compliance team. Erica spent 10 years in corporate banking and the financial markets, and brings with her experience in risk, compliance and audit. Erica’s main responsibility will be to further enhance the NACFB’s field compliance support across the UK. Her appointment strengthens the NACFB’s commitment to raising professional standards across the sector as we continue to build the association as a kitemark of quality that can be trusted in the SME and commercial lending markets.

The Commercial Finance Conference will form one of three strands at the Lending Summit 2018 hosted at London’s Hilton Bankside.

The conference’s agenda will feature guest speakers, panel sessions and host the NACFB’s Annual General Meeting.

Exclusively discounted rate for both NACFB Members and Patrons.

creditstrategy.co.uk/events Sponsors

Event supporter:

Helping Fund UK Business

6 | NACFB Magazine

Hosted by:

NACFB NEWS

NACFB NEWS

Notes from our sponsor Alan MacRae Broker director Lloyds Bank Asset Finance

Alan MacRae, broker director at Lloyds Bank, sheds light on their asset finance offering and the role of the product in today’s market.

Tell us about the asset finance proposition at Lloyds Bank.

For us, asset finance is one of the main ways of supporting the industry and our Helping Britain Prosper plan – and the broker channel plays a key part in this. A substantial portion of all the asset finance deals Lloyds Bank Commercial Banking does come through the channel, and it’s growing.

In three and a half years the team has expanded from five to eight dedicated relationship managers. We have a dedicated broker support team, plus we’re investing in additional staff, additional infrastructure support and utilising new technologies to improve the broker and client experience. We are committed to supporting brokers and helping their clients achieve their business objectives.

Where does Lloyds Bank fit in the asset finance marketplace?

With a wide supply of funders, the broker market for asset finance is competitive. We are a leading traditional hard asset funder – plant, machinery, vehicles, printing presses etc – although around 10% of our deals involve softer assets, such as IT equipment.

What do you look for in a deal?

The customer is at the centre of everything we do and it’s about treating them fairly. We look at a balance of things; the ability and intention to repay, as well as the security we take in an asset. We don’t do deals just because an asset is secure – we also want to be able to demonstrate that the customer can afford the asset they’re buying.

offer very competitive pricing and quality service. The team is focused on building relationships with our broker partners to maximise opportunities for them and their clients.

Is asset finance becoming more popular?

Most of what we do is in the SME space and we’ve definitely seen growth there. Despite recent market uncertainties we are still seeing businesses continue to grow, investing in plant, machinery and assets to ensure they remain competitive. This year we have seen an increase in terms of leads and deals.

Dates for your diary Commercial mortgages finance day When: 4th Sept – 8.30am-4.30pm Where: Holiday Inn Express, Oxford Compliance workshop – Social media in business When: 18th September – 10am-3pm Where: NACFB, 33 East Cheap London Bridging finance day When: 20th Sept – 8.30am-4.30pm Where: Radisson Blu, Edwardian, Manchester Buy-to-let finance day When: 26th Sept – 8.30am-4.30pm Where: The Midland Hotel, Manchester

Compliance workshop – Social media in business When: 26th September – 10am-3pm Where: NACFB, 33 East Cheap London

Cashflow finance day When: 11th October – 8.30am-4.30pm Where: Radisson Blu, Birmingham City Centre, Birmingham

Factor & invoice finance day When: 2nd October – 8.30am-4.30pm Where: Radisson Blu Edwardian, Vanderbilt, London

Development finance day When: 23rd October – 8.30am-4.30pm Where: Radisson Blu Hotel Leeds, Leeds

Compliance workshop – Social media in business When: 4th October – 10am-3pm Where: NACFB, 33 East Cheap London

Buy-to-let finance day When: 30th October – 8.30am-4.30pm Where: TBC

Compliance workshop – Social media in business When: 10th October – 10am-3pm Where: NACFB, 33 East Cheap London

Lending Summit: CFC & NACFB AGM When: Lending Summit: Commercial Finance Conference & NACFB AGM Where: Hilton London Bankside, London

Where do brokers fit into this?

We’re probably unique in that we have a mix of our own Lloyds Bank relationship managers doing business, and a broker channel.

For the client, using a broker means they’ve got one person who can place everything for them. Brokers have access to a huge choice of funders, so they can find the best funder with the best rates that’s most appropriate for those assets.

From a Lloyds Bank perspective too, the broker has become really important. It’s a key route to market for us and one that we’re investing in. We’re getting better at giving brokers more solutions they can offer their clients, supporting them with our knowledge and making ourselves more userfriendly and approachable.

What does Lloyds Bank have to offer brokers?

We’re very quick on turnaround, especially in pay-outs, which is crucial in asset finance. It’s very fast-paced: half of what we do in a month is proposed in that month. We also

8 | NACFB Magazine

NACFB Magazine | 9

NACFB NEWS

NACFB NEWS

Notes from our sponsor Alan MacRae Broker director Lloyds Bank Asset Finance

Alan MacRae, broker director at Lloyds Bank, sheds light on their asset finance offering and the role of the product in today’s market.

Tell us about the asset finance proposition at Lloyds Bank.

For us, asset finance is one of the main ways of supporting the industry and our Helping Britain Prosper plan – and the broker channel plays a key part in this. A substantial portion of all the asset finance deals Lloyds Bank Commercial Banking does come through the channel, and it’s growing.

In three and a half years the team has expanded from five to eight dedicated relationship managers. We have a dedicated broker support team, plus we’re investing in additional staff, additional infrastructure support and utilising new technologies to improve the broker and client experience. We are committed to supporting brokers and helping their clients achieve their business objectives.

Where does Lloyds Bank fit in the asset finance marketplace?

With a wide supply of funders, the broker market for asset finance is competitive. We are a leading traditional hard asset funder – plant, machinery, vehicles, printing presses etc – although around 10% of our deals involve softer assets, such as IT equipment.

What do you look for in a deal?

The customer is at the centre of everything we do and it’s about treating them fairly. We look at a balance of things; the ability and intention to repay, as well as the security we take in an asset. We don’t do deals just because an asset is secure – we also want to be able to demonstrate that the customer can afford the asset they’re buying.

offer very competitive pricing and quality service. The team is focused on building relationships with our broker partners to maximise opportunities for them and their clients.

Is asset finance becoming more popular?

Most of what we do is in the SME space and we’ve definitely seen growth there. Despite recent market uncertainties we are still seeing businesses continue to grow, investing in plant, machinery and assets to ensure they remain competitive. This year we have seen an increase in terms of leads and deals.

Dates for your diary Commercial mortgages finance day When: 4th Sept – 8.30am-4.30pm Where: Holiday Inn Express, Oxford Compliance workshop – Social media in business When: 18th September – 10am-3pm Where: NACFB, 33 East Cheap London Bridging finance day When: 20th Sept – 8.30am-4.30pm Where: Radisson Blu, Edwardian, Manchester Buy-to-let finance day When: 26th Sept – 8.30am-4.30pm Where: The Midland Hotel, Manchester

Compliance workshop – Social media in business When: 26th September – 10am-3pm Where: NACFB, 33 East Cheap London

Cashflow finance day When: 11th October – 8.30am-4.30pm Where: Radisson Blu, Birmingham City Centre, Birmingham

Factor & invoice finance day When: 2nd October – 8.30am-4.30pm Where: Radisson Blu Edwardian, Vanderbilt, London

Development finance day When: 23rd October – 8.30am-4.30pm Where: Radisson Blu Hotel Leeds, Leeds

Compliance workshop – Social media in business When: 4th October – 10am-3pm Where: NACFB, 33 East Cheap London

Buy-to-let finance day When: 30th October – 8.30am-4.30pm Where: TBC

Compliance workshop – Social media in business When: 10th October – 10am-3pm Where: NACFB, 33 East Cheap London

Lending Summit: CFC & NACFB AGM When: Lending Summit: Commercial Finance Conference & NACFB AGM Where: Hilton London Bankside, London

Where do brokers fit into this?

We’re probably unique in that we have a mix of our own Lloyds Bank relationship managers doing business, and a broker channel.

For the client, using a broker means they’ve got one person who can place everything for them. Brokers have access to a huge choice of funders, so they can find the best funder with the best rates that’s most appropriate for those assets.

From a Lloyds Bank perspective too, the broker has become really important. It’s a key route to market for us and one that we’re investing in. We’re getting better at giving brokers more solutions they can offer their clients, supporting them with our knowledge and making ourselves more userfriendly and approachable.

What does Lloyds Bank have to offer brokers?

We’re very quick on turnaround, especially in pay-outs, which is crucial in asset finance. It’s very fast-paced: half of what we do in a month is proposed in that month. We also

8 | NACFB Magazine

NACFB Magazine | 9

NACFB | cover story

How can the UK’s SME commissioner help brokers?

Graham Toy CEO NACFB

The UK appointed its first small business commissioner in October 2017, following a two-year search for the right candidate. Proposed back in July 2015 by then small business minister Anna Soubry, the appointment of former Conservative MP Paul Uppal came as a welcome relief for start-ups and SMEs across the country.

Some were critical of Paul’s appointment, with a survey from NACFB Patron Close Brothers finding that less than one in five SMEs anticipated the small business commissioner would have any positive impact on their business.

Less than a year into his role, Norman Chambers and I met Paul in his Birmingham office to find out what he and his team have been up to, to increase his awareness of the broking community and to promote the array of finance options available to the businesses he advises.

10 | NACFB Magazine

NACFB Magazine | 11

NACFB | cover story

How can the UK’s SME commissioner help brokers?

Graham Toy CEO NACFB

The UK appointed its first small business commissioner in October 2017, following a two-year search for the right candidate. Proposed back in July 2015 by then small business minister Anna Soubry, the appointment of former Conservative MP Paul Uppal came as a welcome relief for start-ups and SMEs across the country.

Some were critical of Paul’s appointment, with a survey from NACFB Patron Close Brothers finding that less than one in five SMEs anticipated the small business commissioner would have any positive impact on their business.

Less than a year into his role, Norman Chambers and I met Paul in his Birmingham office to find out what he and his team have been up to, to increase his awareness of the broking community and to promote the array of finance options available to the businesses he advises.

10 | NACFB Magazine

NACFB Magazine | 11

NACFB NEWS

Championing British brokers I was keen to share with Paul how each year 100,000 small firms are turned down for approximately £4bn of loans by some of the larger British banks and spoke of how there is frustration in the broker community that as few as three per cent of those rejected seek alternative financing options.

Paul acknowledged that there are clearly high levels of credit available but, for the time being at least, stopped short of directly supporting SMEs by utilising his position to direct them to finance solutions through the broker market. He did outline though that his office was looking at ways to increase awareness of the opportunities for those small and medium-sized enterprises struggling to access funding at present.

“As a former small business owner, I know that many SMEs simply aren’t aware of all the options open to them,” Paul outlined.

“But I also know that getting the attention of an SME is incredibly difficult. With my SME I was very fortunate to come from a family background where everyone I know ran a business, there wasn’t a psychological issue for me borrowing money from my bank at the age of 18 – but I was very lucky.”

Norman emphasised to Paul and his team how intermediaries remain valuable allies for lenders in the effort to match ambitious small firms with the right kind of growth capital, adding that NACFB Members saw small business clients increasingly asking them for information about alternative types of funding.

Paul said: “I can really see a gap in the market for brokers. Often a small business will only get a bank relationship manager once they have reached a certain level of turnover.

It seems to me that the brokers are operating as modern-day faceto-face relationship managers, and can fill a knowledge gap in terms of wider business advice.”

UK funding disparity Paul called upon brokers to work alongside lenders in reaching beyond London to parts of the UK often overlooked by the lending community.

12 | NACFB Magazine

NACFB NEWS

“It is clear that improving the supply and demand for finance among high-growth firms in all regions could help to deliver better economic outcomes nationally and reduce regional inequalities,” he said.

We estimate that at least 50,000 businesses go under every year owing to late payments. And speaking candidly, we believe we are one of the last chance saloons before legislation

Some 3.7 million UK private sector businesses are located outside of London and the South East.

Manchester alone has seen SME growth rise by over a third since 2010, but data from the British Business Bank released this year showed that SMEs in London still received more funding than any other region in the UK. Additionally, no region outside of London and the South East has yet seen GDP per capita return to its pre-crisis peak.

“London is often perceived as being a country within a country, and central London is a country within London” Paul explained. “During one of the conversations I had early on with the British Business Bank, it shared that although only 20% of SMEs are based within the M25, they currently receive 50% of the funding.”

Paul also recognised the work his own office must do: “We don’t yet have a specific remit within the Northern Powerhouse and Midlands Engine projects - they have reached out to us, but the fact that our office is not based in London sometimes surprises people.”

Late Payment Initiative Paul’s office is an independent public body with a primary remit of tackling the issue of late payments to SMEs - one that costs the UK economy £2.5bn a year.

“We estimate that at least 50,000 businesses go under every year owing to late payments. And speaking candidly, we believe we are one of the last chance saloons before legislation,” he explained.

“Nearly half a trillion pounds is tied up in working capital – that’s almost a third of UK GDP – and not many people are talking about it.”

When asked if his team had been advising struggling SMEs of the invoice finance options available to them, Paul admitted that it had not, and recognised that this was an area his team could develop.

Although only 20% of SMEs are based within the M25, they currently receive 50% of the funding

He said: “If a small business has a very specific or niche requirement for lending we’re more than happy to point them in the right direction.

We can signpost small SMEs to both brokers and to lenders.

“It tends to be the lifestyle and microbusinesses that are not aware of invoice financing; medium enterprises tend to already have facilities in place.

We can talk about invoice financing as an option, but we would be unable to make any direct recommendations.”

NACFB Patron Hitachi Capital found that 63 per cent of businesses with an annual turnover of less than £1m were impacted by customers who refused to pay for their services. It revealed that 20 per cent of small businesses were dealing with nonpayment of 20 per cent of their invoices, as companies wait for an estimated £50bn in unpaid invoices.

Broadening remit Paul shared his vision for the future SME commissioner’s office and how he saw his remit widening. He views late payments “as a symptom of a broader disease” – one that can be addressed by engaging more widely with the business community and committing to greater SME upskilling and education.

He predicted the office’s direction of travel: “By November you should see our remit change. We will hopefully be given more authority and potentially even powers to fine repeated late paying offenders.”

The NACFB team spoke of how SMEs will also need educating on using alternative finance methods, given that some SMEs are simply unaware of

P2P lending, VAT or invoice financing, and saw the commissioner’s office as a platform for this – highlighting that raising awareness of the increase in, and easier access to, different funding options should also form a tenant of Paul’s future remit.

NACFB Magazine | 13

NACFB NEWS

Championing British brokers I was keen to share with Paul how each year 100,000 small firms are turned down for approximately £4bn of loans by some of the larger British banks and spoke of how there is frustration in the broker community that as few as three per cent of those rejected seek alternative financing options.

Paul acknowledged that there are clearly high levels of credit available but, for the time being at least, stopped short of directly supporting SMEs by utilising his position to direct them to finance solutions through the broker market. He did outline though that his office was looking at ways to increase awareness of the opportunities for those small and medium-sized enterprises struggling to access funding at present.

“As a former small business owner, I know that many SMEs simply aren’t aware of all the options open to them,” Paul outlined.

“But I also know that getting the attention of an SME is incredibly difficult. With my SME I was very fortunate to come from a family background where everyone I know ran a business, there wasn’t a psychological issue for me borrowing money from my bank at the age of 18 – but I was very lucky.”

Norman emphasised to Paul and his team how intermediaries remain valuable allies for lenders in the effort to match ambitious small firms with the right kind of growth capital, adding that NACFB Members saw small business clients increasingly asking them for information about alternative types of funding.

Paul said: “I can really see a gap in the market for brokers. Often a small business will only get a bank relationship manager once they have reached a certain level of turnover.

It seems to me that the brokers are operating as modern-day faceto-face relationship managers, and can fill a knowledge gap in terms of wider business advice.”

UK funding disparity Paul called upon brokers to work alongside lenders in reaching beyond London to parts of the UK often overlooked by the lending community.

12 | NACFB Magazine

NACFB NEWS

“It is clear that improving the supply and demand for finance among high-growth firms in all regions could help to deliver better economic outcomes nationally and reduce regional inequalities,” he said.

We estimate that at least 50,000 businesses go under every year owing to late payments. And speaking candidly, we believe we are one of the last chance saloons before legislation

Some 3.7 million UK private sector businesses are located outside of London and the South East.

Manchester alone has seen SME growth rise by over a third since 2010, but data from the British Business Bank released this year showed that SMEs in London still received more funding than any other region in the UK. Additionally, no region outside of London and the South East has yet seen GDP per capita return to its pre-crisis peak.

“London is often perceived as being a country within a country, and central London is a country within London” Paul explained. “During one of the conversations I had early on with the British Business Bank, it shared that although only 20% of SMEs are based within the M25, they currently receive 50% of the funding.”

Paul also recognised the work his own office must do: “We don’t yet have a specific remit within the Northern Powerhouse and Midlands Engine projects - they have reached out to us, but the fact that our office is not based in London sometimes surprises people.”

Late Payment Initiative Paul’s office is an independent public body with a primary remit of tackling the issue of late payments to SMEs - one that costs the UK economy £2.5bn a year.

“We estimate that at least 50,000 businesses go under every year owing to late payments. And speaking candidly, we believe we are one of the last chance saloons before legislation,” he explained.

“Nearly half a trillion pounds is tied up in working capital – that’s almost a third of UK GDP – and not many people are talking about it.”

When asked if his team had been advising struggling SMEs of the invoice finance options available to them, Paul admitted that it had not, and recognised that this was an area his team could develop.

Although only 20% of SMEs are based within the M25, they currently receive 50% of the funding

He said: “If a small business has a very specific or niche requirement for lending we’re more than happy to point them in the right direction.

We can signpost small SMEs to both brokers and to lenders.

“It tends to be the lifestyle and microbusinesses that are not aware of invoice financing; medium enterprises tend to already have facilities in place.

We can talk about invoice financing as an option, but we would be unable to make any direct recommendations.”

NACFB Patron Hitachi Capital found that 63 per cent of businesses with an annual turnover of less than £1m were impacted by customers who refused to pay for their services. It revealed that 20 per cent of small businesses were dealing with nonpayment of 20 per cent of their invoices, as companies wait for an estimated £50bn in unpaid invoices.

Broadening remit Paul shared his vision for the future SME commissioner’s office and how he saw his remit widening. He views late payments “as a symptom of a broader disease” – one that can be addressed by engaging more widely with the business community and committing to greater SME upskilling and education.

He predicted the office’s direction of travel: “By November you should see our remit change. We will hopefully be given more authority and potentially even powers to fine repeated late paying offenders.”

The NACFB team spoke of how SMEs will also need educating on using alternative finance methods, given that some SMEs are simply unaware of

P2P lending, VAT or invoice financing, and saw the commissioner’s office as a platform for this – highlighting that raising awareness of the increase in, and easier access to, different funding options should also form a tenant of Paul’s future remit.

NACFB Magazine | 13

Compliance | update The latest from our in-house compliance team

Obtaining full FCA authorisation What you need to know

James Hinch (AICA) Adv. CERT (Comp) Compliance consultant NACFB Compliance

As NACFB Members will be aware, financial service providers, investment firms and consumer credit firms in the UK have to be authorised by the Financial Conduct Authority (FCA).

14 | NACFB Magazine

I

n addition, banks, credit unions and insurance companies must also be regulated by the Bank of England’s Prudential Regulation Authority (PRA).

Back in April 2016, the FCA took over the regulation of consumer credit, thus catapulting credit broking into regulation. The FCA is accountable to HM Treasury and has a strategic objective of ensuring relevant markets function well, in addition to three operational objectives, which include: protecting consumers – securing an appropriate degree of protection for consumers protecting financial markets – protecting and enhancing the integrity of the UK financial system promoting competition – promoting effective competition in the interest of consumers.

To be authorised, a firm must comply with a number of rules and follow guidance as set out by the FCA, which holds the power to enforce a range of actions against firms.

Who is authorised?

So why become authorised? Simply, if your firm conducts an activity which falls under the scope of the FCA, you must be regulated. The FCA is bound by the Financial Services & Markets Act (FSMA) and regulates certain activities - if you work in the financial services sector, chances are you will require some form of authorisation.

NACFB brokers conduct credit broking or consumer lending of some description, which means their firms may be captured under a regulated activity. NACFB Members are often in scope for FCA authorisation due to their client’s status. For example, sole traders and partnerships of three or less are treated as ‘individuals’ and as such are treated as consumers regulated by the FCA. It is important to understand the dynamics of the relationship with SMEs and the legal entity with which the business will be conducted.

The authorisation process The FCA application process is now conducted online via the Connect FCA-hosted system, which allows for a smooth application. Granular business

details are required, including any relevant business documents, draft agreements, pre-contract information and promotional literature. The FCA also considers the structure of your firm, its shareholders, any subordinated loans or other external funding, the projected amount of client money held (if your firm holds this) and income from consumer credit activities expected over the next 12 months.

The application also reviews your key approved persons (soon to be replaced by SM&CR – see August’s NACFB Magazine) and reviews your employment history for the past five years, residential addresses for the past three years and details of significant events for each approved person.

This data – and more – will fall within your regulatory business plan, but it is important to ensure that you adequately cover details from other core areas such as:

why your firm wishes to carry out regulated activities whether your firm has identified a business opportunity or customer base where customers will be sourced from, with details of any lead generators introducers or brokers services (both regulated and nonregulated) your firm will sell, as well as the areas you specialise in experience your firm’s governing body or senior management has of the regulated activities you wish to carry out background and experience of everyone performing significant influence-controlled functions (including their employment background and copies of relevant qualifications/examinations)

These are but a few of the topics the FCA will want to know about and many applications for authorisation are delayed owing to a lack of detail and information placed within the business plan.

Support from the NACFB NACFB Compliance continues to work alongside brokers, supporting them with any compliance queries they may have. We also support new and associate Members through the FCA authorisation process and offer this service to anyone who is considering the move to the regulated environment.

If you are looking to become FCAauthorised, our Compliance team is on hand to walk you through the process. You can find out more by emailing the team via compliance@NACFB.org.uk or by calling 0203 9627593.

your long-term strategy, as well as your financial plans fees and how they are explained to the customer.

NACFB Magazine | 15

Compliance | update The latest from our in-house compliance team

Obtaining full FCA authorisation What you need to know

James Hinch (AICA) Adv. CERT (Comp) Compliance consultant NACFB Compliance

As NACFB Members will be aware, financial service providers, investment firms and consumer credit firms in the UK have to be authorised by the Financial Conduct Authority (FCA).

14 | NACFB Magazine

I

n addition, banks, credit unions and insurance companies must also be regulated by the Bank of England’s Prudential Regulation Authority (PRA).

Back in April 2016, the FCA took over the regulation of consumer credit, thus catapulting credit broking into regulation. The FCA is accountable to HM Treasury and has a strategic objective of ensuring relevant markets function well, in addition to three operational objectives, which include: protecting consumers – securing an appropriate degree of protection for consumers protecting financial markets – protecting and enhancing the integrity of the UK financial system promoting competition – promoting effective competition in the interest of consumers.

To be authorised, a firm must comply with a number of rules and follow guidance as set out by the FCA, which holds the power to enforce a range of actions against firms.

Who is authorised?

So why become authorised? Simply, if your firm conducts an activity which falls under the scope of the FCA, you must be regulated. The FCA is bound by the Financial Services & Markets Act (FSMA) and regulates certain activities - if you work in the financial services sector, chances are you will require some form of authorisation.

NACFB brokers conduct credit broking or consumer lending of some description, which means their firms may be captured under a regulated activity. NACFB Members are often in scope for FCA authorisation due to their client’s status. For example, sole traders and partnerships of three or less are treated as ‘individuals’ and as such are treated as consumers regulated by the FCA. It is important to understand the dynamics of the relationship with SMEs and the legal entity with which the business will be conducted.

The authorisation process The FCA application process is now conducted online via the Connect FCA-hosted system, which allows for a smooth application. Granular business

details are required, including any relevant business documents, draft agreements, pre-contract information and promotional literature. The FCA also considers the structure of your firm, its shareholders, any subordinated loans or other external funding, the projected amount of client money held (if your firm holds this) and income from consumer credit activities expected over the next 12 months.

The application also reviews your key approved persons (soon to be replaced by SM&CR – see August’s NACFB Magazine) and reviews your employment history for the past five years, residential addresses for the past three years and details of significant events for each approved person.

This data – and more – will fall within your regulatory business plan, but it is important to ensure that you adequately cover details from other core areas such as:

why your firm wishes to carry out regulated activities whether your firm has identified a business opportunity or customer base where customers will be sourced from, with details of any lead generators introducers or brokers services (both regulated and nonregulated) your firm will sell, as well as the areas you specialise in experience your firm’s governing body or senior management has of the regulated activities you wish to carry out background and experience of everyone performing significant influence-controlled functions (including their employment background and copies of relevant qualifications/examinations)

These are but a few of the topics the FCA will want to know about and many applications for authorisation are delayed owing to a lack of detail and information placed within the business plan.

Support from the NACFB NACFB Compliance continues to work alongside brokers, supporting them with any compliance queries they may have. We also support new and associate Members through the FCA authorisation process and offer this service to anyone who is considering the move to the regulated environment.

If you are looking to become FCAauthorised, our Compliance team is on hand to walk you through the process. You can find out more by emailing the team via compliance@NACFB.org.uk or by calling 0203 9627593.

your long-term strategy, as well as your financial plans fees and how they are explained to the customer.

NACFB Magazine | 15

COMPLIANCE

Case study Lee Darbyshire (pictured right), of Factoring & Finance Independent Review Services Ltd, who obtained FCA authorisation with support from the NACFB, shares his story: I am relatively new to the world of brokering and at times it can be difficult to know where to turn to ensure that you’re doing everything right.

NACFB Compliance support is available to all NACFB Members. Our team will provide you and your Brokerage with the guidance, training and support necessary to remain fully compliant with both regulatory requirements and the NACFB Minimum Standards.

At the outset I scanned the internet for guidance on gaining my FCA authorisation and when looking at the documents, it became extremely daunting. At one point I considered taking the easy option and becoming an authorised representative through another company that was advertising on the internet, but I was determined to remain completely independent and not be under the control or bound by the restrictions of anyone else.

After an initial enquiry to the NACFB I was advised that the Association assists people through the process and I am happy to report that I have now gained my full authorised status with the FCA. The Association’s support and guidance has been second to none and without the NACFB, I think I would have still been rotating one application from the top of the pile to the bottom of the pile until I could finally face trying to complete it on my own – and would have probably still been in the process 12 months from now.

25 Years Sector Experience

16 | NACFB Magazine

Patron Engagement

Promoting a kitemark of quality and trust before the regulator, clients and lenders maintaining sector confidence

Facilitating harmonisation between key stakeholders when new regulation is introduced.

Calendar of Workshops Centralised Personal Support

Hosting bespoke workshops, training sessions and webinars on a diverse range of industry matters.

Thanks to the NACFB checking over my business plan, documentation and ensuring all of the correct boxes were ticked, as well as providing guidance and support, my application flew through. I was simply asked to confirm the required financial standing of the company and the value of regulated business that I expect to do in the next 12 months. I was expecting to have to answer numerous questions and for it to drag out over months.

I can honestly say that applying for authorisation is a daunting process, but it has been made extremely straightforward by the NACFB. Personally, I think the NACFB needs to make people more aware that this is a service it offers, and I would certainly recommend this service to anyone entering the industry.

Members of the NACFB benefit from access to a wide range of bespoke template documents, help-desk support, regulatory updates, targeted workshops and access to our MyNACFB training portal.

Delivering high-quality expert insight via email and telephone as well as consultations in person.

Model Office & Pragmatic Support Providing a full suite of the latest customisable working documents for your business.

w. t. e. a.

nacfbcompliance.co.uk 02071010359 compliance@nacfb.org.uk 33 Eastcheap, London, EC3M 1DT

Regulatory Dialogue & Future Insight Maintaining a dialogue with the regulator keeping ahead of the curve.

@NACFBCompliance linkedin.com/in/nacfb

COMPLIANCE

Case study Lee Darbyshire (pictured right), of Factoring & Finance Independent Review Services Ltd, who obtained FCA authorisation with support from the NACFB, shares his story: I am relatively new to the world of brokering and at times it can be difficult to know where to turn to ensure that you’re doing everything right.

NACFB Compliance support is available to all NACFB Members. Our team will provide you and your Brokerage with the guidance, training and support necessary to remain fully compliant with both regulatory requirements and the NACFB Minimum Standards.

At the outset I scanned the internet for guidance on gaining my FCA authorisation and when looking at the documents, it became extremely daunting. At one point I considered taking the easy option and becoming an authorised representative through another company that was advertising on the internet, but I was determined to remain completely independent and not be under the control or bound by the restrictions of anyone else.

After an initial enquiry to the NACFB I was advised that the Association assists people through the process and I am happy to report that I have now gained my full authorised status with the FCA. The Association’s support and guidance has been second to none and without the NACFB, I think I would have still been rotating one application from the top of the pile to the bottom of the pile until I could finally face trying to complete it on my own – and would have probably still been in the process 12 months from now.

25 Years Sector Experience

16 | NACFB Magazine

Patron Engagement

Promoting a kitemark of quality and trust before the regulator, clients and lenders maintaining sector confidence

Facilitating harmonisation between key stakeholders when new regulation is introduced.

Calendar of Workshops Centralised Personal Support

Hosting bespoke workshops, training sessions and webinars on a diverse range of industry matters.

Thanks to the NACFB checking over my business plan, documentation and ensuring all of the correct boxes were ticked, as well as providing guidance and support, my application flew through. I was simply asked to confirm the required financial standing of the company and the value of regulated business that I expect to do in the next 12 months. I was expecting to have to answer numerous questions and for it to drag out over months.

I can honestly say that applying for authorisation is a daunting process, but it has been made extremely straightforward by the NACFB. Personally, I think the NACFB needs to make people more aware that this is a service it offers, and I would certainly recommend this service to anyone entering the industry.

Members of the NACFB benefit from access to a wide range of bespoke template documents, help-desk support, regulatory updates, targeted workshops and access to our MyNACFB training portal.

Delivering high-quality expert insight via email and telephone as well as consultations in person.

Model Office & Pragmatic Support Providing a full suite of the latest customisable working documents for your business.

w. t. e. a.

nacfbcompliance.co.uk 02071010359 compliance@nacfb.org.uk 33 Eastcheap, London, EC3M 1DT

Regulatory Dialogue & Future Insight Maintaining a dialogue with the regulator keeping ahead of the curve.

@NACFBCompliance linkedin.com/in/nacfb

Bibby Financial Services names new commercial director Bibby Financial Services (BFS) has appointed Paul Stack as its commercial director for Europe and Asia.

In his new role, he will be responsible for product, pricing and commercial strategy implementation across the regions.

Paul joined BFS in April 2015 as UK product director and was responsible for driving the development, management and innovation of the UK product portfolio.

Commercial Finance

STB Commercial Finance doubles lending Secure Trust Bank (STB) Commercial Finance has seen its lending balances double over the last 12 months.

The commercial finance arm of the specialist bank saw its lending balances rise to £187.5m in the year to 30th June 2018, up on the £94.2m seen the previous year.

The growth has allowed the firm to focus on its expansion across the UK.

LendInvest introduces five-year fixed rate exclusive

Sancus expands business in Ireland with two new directors Alternative financial services provider Sancus BMS Group – part of GLI Finance – has made two new senior appointments as it expands its business in Ireland.

Michael Mooney has joined the group as managing director of Sancus BMS (Ireland) Limited.

Geoff Savage has been appointed as director of lending at Sancus BMS (Ireland) Limited.

Over £50m invested into Assetz Capital IFIsa

Former HSBC corporate banking head joins Lendy as NED

Assetz Capital has seen over £50m invested into its Innovative Finance Isa (IFIsa) since it was launched in December last year.

The IFIsa now accounts for over 15% of all loans funded through the platform.

Investors have switched to the Assetz Capital Isa from cash and stocks and shares Isas, with the platform reporting over £20m of completed or in-progress transfers.

Regulated bridging lending hits lowest level since 2015 Regulated bridging loans have fallen to 36.8% of total lending in Q2 2018, down from 43.7% recorded in Q1, according to new research.

The latest Bridging Trends data from mtf revealed that this was the lowest level of regulated bridging since 2015.

Three new contributors have joined Bridging Trends: Complete FS, Finance 4 Business and Pure Commercial Finance.

LendInvest has launched an exclusive five-year fixed rate product for intermediaries through the Buy to Let Club.

The product has a rate of 2.75%, is available up to 75% LTV, and comes with a 4.99% product fee which can be added to the loan.

It is available for purchase and remortgages for loans up to £500,000.

VATBRIDGE names new head of telesales and marketing

Liberis provides £1m to UK SMEs through Sage Pay Business Finance Liberis has now provided a total of £1m of funding to UK SMEs through its Sage Pay Business Finance product.

The product was built in collaboration with cloud business management solutions firm Sage and allows businesses to receive finance as an advance of their future credit and debit card sales.

Loans provided through the product range from between £2,500 to £300,000.

VATBRIDGE has appointed John Migan as its new head of telesales and marketing.

John has spent the last 12 years at board level in both the telecoms and media sectors, taking companies from start-ups to successful market leaders.

Commenting on his new role, John said he was pleased to be involved at VATBRIDGE at such a key time in its growth.

Fundsquire names new UK MD

Fundsquire has appointed Rowan Gallagher as its new UK managing director.

He joins the alternative finance lender from GrantTree, where he was managing director of R&D tax credits.

Fundsquire – which was founded in Australia in 2013, before expanding into the UK in 2016 – has developed its R&D funding product through collaborations with clients and consultants across the world.

Lendco reports over £100m of funding enquiries in first two months Lendco has revealed that it has seen over £100m of funding enquiries during its first two months in operation.

The lender, created by the group behind brokerage SPF Private Clients, started taking enquiries on 1st May following significant investment from Cabot Square Capital.

Lendco is led by managing director Simon Knight.

Lendy has appointed former HSBC Corporate Banking head Nigel Boothroyd as a non-executive director.

Nigel joins the P2P platform after spending 38 years at HSBC Group, with his most recent position at the bank being regional head of lending and transaction management for Europe.

Nigel will chair Lendy’s risk committee.

We know that no two projects are the same, so we identify the unique features of each project and offer a bespoke solution.

Downing’s development loans can be used to:

Downing can offer:

ff fund ff fund

ff first-charge

the acquisition and development of residential property for resale; the acquisition and development of new sites for trading businesses such as care homes, data centres, pubs and children’s nurseries; and ff fund the construction of renewable energy and other infrastructure projects.

Downing’s bridging loans can be used for: ff site

acquisitions; and exit loans.

ff development

Find out more: Phone: 020 7416 7780 Email: investment@downing.co.uk

secured loans up to 70% loan-to-value ranging from £1 million to £10 million; ff introducer fees paid on the first drawdown of the loan facility; ff interest rates typically ranging from 8% - 11% p.a.; and ff terms typically ranging from 6-36 months.

Follow us on Twitter and LinkedIn: @downingllp

Downing LLP

Downing LLP, St Magnus House, 3 Lower Thames Street, London EC3R 6HD, is authorised and regulated by the Financial Conduct Authority (Firm Reference Number 545025).

Information correct as at 23 April 2018.

18 | NACFB Magazine

NACFB Magazine | 19

Bibby Financial Services names new commercial director Bibby Financial Services (BFS) has appointed Paul Stack as its commercial director for Europe and Asia.

In his new role, he will be responsible for product, pricing and commercial strategy implementation across the regions.

Paul joined BFS in April 2015 as UK product director and was responsible for driving the development, management and innovation of the UK product portfolio.

Commercial Finance

STB Commercial Finance doubles lending Secure Trust Bank (STB) Commercial Finance has seen its lending balances double over the last 12 months.

The commercial finance arm of the specialist bank saw its lending balances rise to £187.5m in the year to 30th June 2018, up on the £94.2m seen the previous year.

The growth has allowed the firm to focus on its expansion across the UK.

LendInvest introduces five-year fixed rate exclusive

Sancus expands business in Ireland with two new directors Alternative financial services provider Sancus BMS Group – part of GLI Finance – has made two new senior appointments as it expands its business in Ireland.

Michael Mooney has joined the group as managing director of Sancus BMS (Ireland) Limited.

Geoff Savage has been appointed as director of lending at Sancus BMS (Ireland) Limited.

Over £50m invested into Assetz Capital IFIsa

Former HSBC corporate banking head joins Lendy as NED

Assetz Capital has seen over £50m invested into its Innovative Finance Isa (IFIsa) since it was launched in December last year.

The IFIsa now accounts for over 15% of all loans funded through the platform.

Investors have switched to the Assetz Capital Isa from cash and stocks and shares Isas, with the platform reporting over £20m of completed or in-progress transfers.

Regulated bridging lending hits lowest level since 2015 Regulated bridging loans have fallen to 36.8% of total lending in Q2 2018, down from 43.7% recorded in Q1, according to new research.

The latest Bridging Trends data from mtf revealed that this was the lowest level of regulated bridging since 2015.

Three new contributors have joined Bridging Trends: Complete FS, Finance 4 Business and Pure Commercial Finance.

LendInvest has launched an exclusive five-year fixed rate product for intermediaries through the Buy to Let Club.

The product has a rate of 2.75%, is available up to 75% LTV, and comes with a 4.99% product fee which can be added to the loan.

It is available for purchase and remortgages for loans up to £500,000.

VATBRIDGE names new head of telesales and marketing

Liberis provides £1m to UK SMEs through Sage Pay Business Finance Liberis has now provided a total of £1m of funding to UK SMEs through its Sage Pay Business Finance product.

The product was built in collaboration with cloud business management solutions firm Sage and allows businesses to receive finance as an advance of their future credit and debit card sales.

Loans provided through the product range from between £2,500 to £300,000.

VATBRIDGE has appointed John Migan as its new head of telesales and marketing.

John has spent the last 12 years at board level in both the telecoms and media sectors, taking companies from start-ups to successful market leaders.

Commenting on his new role, John said he was pleased to be involved at VATBRIDGE at such a key time in its growth.

Fundsquire names new UK MD

Fundsquire has appointed Rowan Gallagher as its new UK managing director.

He joins the alternative finance lender from GrantTree, where he was managing director of R&D tax credits.

Fundsquire – which was founded in Australia in 2013, before expanding into the UK in 2016 – has developed its R&D funding product through collaborations with clients and consultants across the world.

Lendco reports over £100m of funding enquiries in first two months Lendco has revealed that it has seen over £100m of funding enquiries during its first two months in operation.

The lender, created by the group behind brokerage SPF Private Clients, started taking enquiries on 1st May following significant investment from Cabot Square Capital.

Lendco is led by managing director Simon Knight.

Lendy has appointed former HSBC Corporate Banking head Nigel Boothroyd as a non-executive director.

Nigel joins the P2P platform after spending 38 years at HSBC Group, with his most recent position at the bank being regional head of lending and transaction management for Europe.

Nigel will chair Lendy’s risk committee.

We know that no two projects are the same, so we identify the unique features of each project and offer a bespoke solution.

Downing’s development loans can be used to:

Downing can offer:

ff fund ff fund

ff first-charge

the acquisition and development of residential property for resale; the acquisition and development of new sites for trading businesses such as care homes, data centres, pubs and children’s nurseries; and ff fund the construction of renewable energy and other infrastructure projects.

Downing’s bridging loans can be used for: ff site

acquisitions; and exit loans.

ff development

Find out more: Phone: 020 7416 7780 Email: investment@downing.co.uk

secured loans up to 70% loan-to-value ranging from £1 million to £10 million; ff introducer fees paid on the first drawdown of the loan facility; ff interest rates typically ranging from 8% - 11% p.a.; and ff terms typically ranging from 6-36 months.

Follow us on Twitter and LinkedIn: @downingllp

Downing LLP

Downing LLP, St Magnus House, 3 Lower Thames Street, London EC3R 6HD, is authorised and regulated by the Financial Conduct Authority (Firm Reference Number 545025).

Information correct as at 23 April 2018.

18 | NACFB Magazine

NACFB Magazine | 19

Top | story Our pick of the latest Patron news

Shawbrook predicts BTL market to stabilise by 2021 Tom Belger Senior reporter Bridging & Commercial

T

he BTL market is predicted to continue to dampen over the next three years, before the market stabilises in 2021 and returns to growth in the following two years, according to new analysis.

The UK Buy to Let report – produced by Shawbrook Bank and compiled by the Centre for Economics and Business Research (CEBR) – forecasts BTL market activity up to 2023 and compares this projection with a scenario in which the government’s various policy interventions were not introduced.

The analysis is then able to give an idea of the magnitude of these measures and how they have affected the BTL market.

This latest report has revealed a marked change in BTL activity following government intervention, with the number of BTL mortgage approvals for house purchases falling in 2016 by 13%.

This was followed by a steeper fall of 27% in 2017 as the sector adjusted to new regulation.

The report expects this transformation will continue until 2021, but this will be less severe than the market has experienced in recent years as strong demand in the private rental sector and a ‘core’ of professional landlords counter the effects.

The research predicts moderate growth in the BTL market from 2021 in the years leading up to 2023.

In contrast – under the no-reform scenario – Shawbrook would have expected the share of BTL mortgages to have stayed higher for longer, averaging at around 13% between 2018 and 2023, compared to 7% under the new scenario analysis.

20 | NACFB Magazine

Buy-to-let mortgages under a central and a counterfactual scenario 200k 180k 160k 140k

Commercial mortgages without the hassle

120k 100k

No nonsense, no red tape

80k 60k 40k 20k 0 2006

2010 Central scenario Counterfactual scenario

2015

2020

Source: CML, Ceber analysis 2006-2007 data for the central scenario are actual data by the CML; 2018-2023 data are forcasts

Meanwhile, the analysis estimates that 360,000 more BTL mortgages would have been issued if the changes to the tax system and underwriting process had not occurred.

The analysis estimates that 360,000 more BTL mortgages would have been issued if the changes to the tax system and underwriting process had not occurred

Karen Bennett, managing director for commercial mortgages at Shawbrook said that while the series of government and regulatory changes had made a significant impact on the market, it had seen the impact felt more heavily among the amateur landlord community, presenting an opportunity for professional investors.

We’ve got commercial mortgages covered. We’re breaking through barriers to give your customers a decision in principle within 24 hours.

Loans from as low as 5.9%.

Welcome to fast, flexible finance

“Recent political turbulence has had an amplifying effect on investor confidence but, positively, the market remains buoyant for those with a long-term strategy who draw upon specialist advice to fully understand the impact of these policy shifts.

“Regulatory change that supports the public interest is not something to be afraid of, and we predict that this high performing asset class will remain a fundamental strength over the long-term provided lenders continue to adapt and change alongside it.”

Find out more at assetzcapital.co.uk/borrow or call 0800 470 0432 Assetz SME Capital Ltd is a company registered in England and Wales with company number 08007287. Assetz SME Capital Ltd is authorised and regulated by the Financial Conduct Authority (Reg No: 724996). ‘Assetz Capital’ is a trading name of Assetz SME Capital Ltd. Assetz SME Capital Ltd is registered with the Office of the Information Commissioner (Reg No: Z3338899) for data protection purposes.

Top | story Our pick of the latest Patron news

Shawbrook predicts BTL market to stabilise by 2021 Tom Belger Senior reporter Bridging & Commercial

T

he BTL market is predicted to continue to dampen over the next three years, before the market stabilises in 2021 and returns to growth in the following two years, according to new analysis.

The UK Buy to Let report – produced by Shawbrook Bank and compiled by the Centre for Economics and Business Research (CEBR) – forecasts BTL market activity up to 2023 and compares this projection with a scenario in which the government’s various policy interventions were not introduced.

The analysis is then able to give an idea of the magnitude of these measures and how they have affected the BTL market.

This latest report has revealed a marked change in BTL activity following government intervention, with the number of BTL mortgage approvals for house purchases falling in 2016 by 13%.

This was followed by a steeper fall of 27% in 2017 as the sector adjusted to new regulation.

The report expects this transformation will continue until 2021, but this will be less severe than the market has experienced in recent years as strong demand in the private rental sector and a ‘core’ of professional landlords counter the effects.

The research predicts moderate growth in the BTL market from 2021 in the years leading up to 2023.

In contrast – under the no-reform scenario – Shawbrook would have expected the share of BTL mortgages to have stayed higher for longer, averaging at around 13% between 2018 and 2023, compared to 7% under the new scenario analysis.

20 | NACFB Magazine

Buy-to-let mortgages under a central and a counterfactual scenario 200k 180k 160k 140k

Commercial mortgages without the hassle

120k 100k

No nonsense, no red tape

80k 60k 40k 20k 0 2006

2010 Central scenario Counterfactual scenario

2015

2020

Source: CML, Ceber analysis 2006-2007 data for the central scenario are actual data by the CML; 2018-2023 data are forcasts

Meanwhile, the analysis estimates that 360,000 more BTL mortgages would have been issued if the changes to the tax system and underwriting process had not occurred.

The analysis estimates that 360,000 more BTL mortgages would have been issued if the changes to the tax system and underwriting process had not occurred

Karen Bennett, managing director for commercial mortgages at Shawbrook said that while the series of government and regulatory changes had made a significant impact on the market, it had seen the impact felt more heavily among the amateur landlord community, presenting an opportunity for professional investors.

We’ve got commercial mortgages covered. We’re breaking through barriers to give your customers a decision in principle within 24 hours.

Loans from as low as 5.9%.

Welcome to fast, flexible finance

“Recent political turbulence has had an amplifying effect on investor confidence but, positively, the market remains buoyant for those with a long-term strategy who draw upon specialist advice to fully understand the impact of these policy shifts.

“Regulatory change that supports the public interest is not something to be afraid of, and we predict that this high performing asset class will remain a fundamental strength over the long-term provided lenders continue to adapt and change alongside it.”

Find out more at assetzcapital.co.uk/borrow or call 0800 470 0432 Assetz SME Capital Ltd is a company registered in England and Wales with company number 08007287. Assetz SME Capital Ltd is authorised and regulated by the Financial Conduct Authority (Reg No: 724996). ‘Assetz Capital’ is a trading name of Assetz SME Capital Ltd. Assetz SME Capital Ltd is registered with the Office of the Information Commissioner (Reg No: Z3338899) for data protection purposes.

Introducing New and refreshed offerings for NACFB brokers on behalf of Patrons and Members

When Rob decided to ride solo and buy his own bike shop, we were right behind him with a bridging loan.

Precise launches holiday buy-to-let offering

P

recise Mortgages has announced its launch into the holiday buy-to-let market, in response to growing demand from brokers supporting professional landlords.

than 20 properties (9%) owns holiday lets in the UK, with a further 9% owning holiday lets abroad. For all landlords interviewed as part of the survey, holiday lets were the second most popular property type to own in addition to residential portfolios.

choose from Precise’s core buy-tolet range with rates starting from 2.77%, and will be able to borrow up to £500,000 to a maximum 70% LTV – or opt for a bridging finance loan.

The holiday let option is part of a raft of buy-to-let and bridging criteria enhancements to help landlords wanting to take advantage of evolving market opportunities.

The research also found that 12% of all landlords owned multi-unit properties rising to one in three (34%) among those with 20-plus properties.

Alan Cleary, managing director at Precise Mortgages, said: “The UK is proving increasingly popular among both British and overseas tourists, which is generating attractive rental returns for holiday lets.

Together with its launch into the new sector, the specialist lender is also enhancing its criteria for its multi-unit range.

Precise will consider UK applications on houses and flats currently utilised as holiday lets, providing there are no planning or occupancy restrictions.

“The new criteria across the buy-tolet mortgage and bridging finance ranges will help more customers secure the product they need.”

Syndicated research carried out for the specialist lender by BDRC shows nearly one in 10 landlords with more

Experienced individual and limited company landlords wanting to invest in a holiday let will be able to

At Together our experience spans over decades and tens of thousands of bridging loans. So being self-employed and buying a property for commercial use, is perfectly normal to us. To find out more about bridging loans and our flexible approach to lending call or have a look online.

Call us on 0333 455 1178 or visit togethermoney.com/bridging For professional intermediary use only.

‘Rob’ has been used for illustrative purposes only.

22 | NACFB Magazine

Introducing New and refreshed offerings for NACFB brokers on behalf of Patrons and Members

When Rob decided to ride solo and buy his own bike shop, we were right behind him with a bridging loan.

Precise launches holiday buy-to-let offering

P

recise Mortgages has announced its launch into the holiday buy-to-let market, in response to growing demand from brokers supporting professional landlords.

than 20 properties (9%) owns holiday lets in the UK, with a further 9% owning holiday lets abroad. For all landlords interviewed as part of the survey, holiday lets were the second most popular property type to own in addition to residential portfolios.

choose from Precise’s core buy-tolet range with rates starting from 2.77%, and will be able to borrow up to £500,000 to a maximum 70% LTV – or opt for a bridging finance loan.

The holiday let option is part of a raft of buy-to-let and bridging criteria enhancements to help landlords wanting to take advantage of evolving market opportunities.

The research also found that 12% of all landlords owned multi-unit properties rising to one in three (34%) among those with 20-plus properties.

Alan Cleary, managing director at Precise Mortgages, said: “The UK is proving increasingly popular among both British and overseas tourists, which is generating attractive rental returns for holiday lets.

Together with its launch into the new sector, the specialist lender is also enhancing its criteria for its multi-unit range.

Precise will consider UK applications on houses and flats currently utilised as holiday lets, providing there are no planning or occupancy restrictions.

“The new criteria across the buy-tolet mortgage and bridging finance ranges will help more customers secure the product they need.”

Syndicated research carried out for the specialist lender by BDRC shows nearly one in 10 landlords with more

Experienced individual and limited company landlords wanting to invest in a holiday let will be able to

At Together our experience spans over decades and tens of thousands of bridging loans. So being self-employed and buying a property for commercial use, is perfectly normal to us. To find out more about bridging loans and our flexible approach to lending call or have a look online.

Call us on 0333 455 1178 or visit togethermoney.com/bridging For professional intermediary use only.

‘Rob’ has been used for illustrative purposes only.

22 | NACFB Magazine

Case Studies Completion highlights from a selection of our Patrons and Members

Cashflow finance fills gaps in unpredictable sales pattern

John Davies Director Just Cashflow PLC

S

ME owners looking for business finance need commercial brokers to do three main things: make them aware of alternative finance options; help them to work with a lender that can understand their business and provide timely, flexible and appropriate finance solutions; and give reassurance that they will be dealing with a company that treats customers fairly and takes its responsibilities extremely seriously.

Taking the third point first, TCF is at the heart of our business and this includes gaining a good understanding about the business, why the finance is needed and a thorough affordability assessment. This is good for the

24 | NACFB Magazine

customer and reflects well on the broker making the referral.

We always act as if we are a regulated entity – and one day, we may well be – because it is the right way to do business.

Gillian Palmer, director of financial brokerage Lending Made Simple, and her client Matt Ryde, of independent estate agents Graham John Ltd, both welcomed and have benefited from the Just Cash Flow PLC approach and flexible finance facilities.

Matt runs an estate agency with a difference. He explained: “People, not property, are at the centre of our business. We provide tailored moving packages that fit our customers’ needs.”

Evidence of this different approach is that he doesn’t chase the number of listings – like conventional

agencies – and isn’t afraid to tell a customer that the time may not be right to sell their particular property.

“Not every sale is the same and not every owner wants their home marketed in the same way,” he added.

When Matt first approached Gillian, it was clear he needed a flexible finance facility that took into account the length of time and unpredictable pattern of being paid for selling various properties.

You do all the work up front and payment may be months away.

Gillian recommends the Just Cashflow revolving credit facility as it works exactly in the same way as a traditional bank overdraft and allows growing businesses to manage cash flow challenges. Interest is charged on a daily basis and there is no long-term commitment, so it provided Matt with the complete flexibility he needed.

Gillian said: “Matt’s bank was unwilling to provide him with the finance he needed and I knew from experience that Just Cashflow had the right solution for him.”

Not surprisingly, Matt’s ‘people’ approach proved to be popular and he spoke with Gillian again when he wanted to expand the business. On this occasion it was the Just Cashflow business builder product that was recommended.

The product suits both short- and long-term loan requirements with fixed or variable repayments and with access to funds from £10,000-500,000.

Because of its malleable nature, features such as payment holidays, early repayment without penalties or loan extensions can be worked into the design. It also provides borrowers with certainty about the term of the loan and knowing the structure of future monthly repayments.

It was clear he needed a flexible finance facility that took into account the length of time and unpredictable pattern of being paid for selling various properties

Gillian added: “I have used both the revolving credit facility and business builder for many of my clients, noting that flexibility of the products and defined lending criteria make them an ideal choice for growing businesses that need extra funding to take their business to the next level.

“One of the strengths of the team at Just Cashflow is communication and this is key when you are obtaining finance for clients and it is also good to know commission is paid promptly.

“I really appreciate the feedback I receive from my clients when they tell me how much they value the support I give them in growing and developing their businesses.

Just Cashflow provides the same service and understanding.”

NACFB Magazine | 25

Case Studies Completion highlights from a selection of our Patrons and Members

Cashflow finance fills gaps in unpredictable sales pattern

John Davies Director Just Cashflow PLC

S

ME owners looking for business finance need commercial brokers to do three main things: make them aware of alternative finance options; help them to work with a lender that can understand their business and provide timely, flexible and appropriate finance solutions; and give reassurance that they will be dealing with a company that treats customers fairly and takes its responsibilities extremely seriously.

Taking the third point first, TCF is at the heart of our business and this includes gaining a good understanding about the business, why the finance is needed and a thorough affordability assessment. This is good for the

24 | NACFB Magazine

customer and reflects well on the broker making the referral.

We always act as if we are a regulated entity – and one day, we may well be – because it is the right way to do business.

Gillian Palmer, director of financial brokerage Lending Made Simple, and her client Matt Ryde, of independent estate agents Graham John Ltd, both welcomed and have benefited from the Just Cash Flow PLC approach and flexible finance facilities.

Matt runs an estate agency with a difference. He explained: “People, not property, are at the centre of our business. We provide tailored moving packages that fit our customers’ needs.”

Evidence of this different approach is that he doesn’t chase the number of listings – like conventional

agencies – and isn’t afraid to tell a customer that the time may not be right to sell their particular property.

“Not every sale is the same and not every owner wants their home marketed in the same way,” he added.

When Matt first approached Gillian, it was clear he needed a flexible finance facility that took into account the length of time and unpredictable pattern of being paid for selling various properties.

You do all the work up front and payment may be months away.

Gillian recommends the Just Cashflow revolving credit facility as it works exactly in the same way as a traditional bank overdraft and allows growing businesses to manage cash flow challenges. Interest is charged on a daily basis and there is no long-term commitment, so it provided Matt with the complete flexibility he needed.

Gillian said: “Matt’s bank was unwilling to provide him with the finance he needed and I knew from experience that Just Cashflow had the right solution for him.”

Not surprisingly, Matt’s ‘people’ approach proved to be popular and he spoke with Gillian again when he wanted to expand the business. On this occasion it was the Just Cashflow business builder product that was recommended.

The product suits both short- and long-term loan requirements with fixed or variable repayments and with access to funds from £10,000-500,000.

Because of its malleable nature, features such as payment holidays, early repayment without penalties or loan extensions can be worked into the design. It also provides borrowers with certainty about the term of the loan and knowing the structure of future monthly repayments.

It was clear he needed a flexible finance facility that took into account the length of time and unpredictable pattern of being paid for selling various properties

Gillian added: “I have used both the revolving credit facility and business builder for many of my clients, noting that flexibility of the products and defined lending criteria make them an ideal choice for growing businesses that need extra funding to take their business to the next level.

“One of the strengths of the team at Just Cashflow is communication and this is key when you are obtaining finance for clients and it is also good to know commission is paid promptly.

“I really appreciate the feedback I receive from my clients when they tell me how much they value the support I give them in growing and developing their businesses.

Just Cashflow provides the same service and understanding.”

NACFB Magazine | 25

CASE STUDIES

Sale & HP back helps keep things moving Case details Broker: Anglo Scottish Asset Finance Ltd Industry: Transport Product solution: Sale and HP back Loan amount: £2.8m

Mark Gilman Senior broker development manager Close Brothers

Our national team of broker development managers works closely with a growing network of business finance brokers and we pride ourselves on our considerable expertise and ability to understand what brokers are looking for to meet their customers’ requirements.

O

ne of our recent cases involved Anglo Scottish Asset Finance Ltd – an independent finance provider offering a variety of financial services, including asset finance. It offers financial support to businesses, whether they are looking to fund expansion, manage cash flow, acquire assets or even organise some personal finance.

Trading locally for over 20 years, Anglo’s customer was a wellestablished vehicle logistics company specialising in car transportation and fleet delivery services. Anglo has worked with the customer many times over the years, developing a longstanding relationship.

Paul Sargent, director at Anglo, introduced the client to me.

Following a historic aggressive repayment policy from their existing lender, the customer was looking to reduce their monthly outgoings and ease the business cash flow.

They have built up an enviable reputation and have been operating for a number of successful years, but last year the company made a small loss due to uncertainty in

the market. Due to the short-term previously taken on agreements, the customer had good equity held in the fleet of vehicles, but wanted to reduce its monthly expenditure by refinancing over a longer term.

Following a tough year, the new agreement would allow the customer to release some cash and remove some of the debt within the business, easing their financial pressure.

Close Brothers Business Finance recommended a £2.8m refinance deal via a sale and HP back product, which has resulted in savings of around £40,000 per month for the customer by releasing capital from existing assets.

Commenting on the deal, Paul said: “The money released from the existing assets has aided our client to consolidate current debts, reduce outgoings and boost capital.

“They can now continue to grow and by working together with Mark and the Close Brothers team, we will hopefully be able to provide further funding for vehicles for our client in the future.”

Following a tough year, the new agreement would allow the customer to release some cash and remove some of the debt within the business, easing their financial pressure

We’re redefining standard

We’ve put a lot of thought into our newly extended suite of short-term lending products.

In an increasingly diverse world we know brokers need maximum flexibility to handle the widest possible range of client scenarios.

Standard bridging that’s anything but standard • • • • •

Prime Bridging Standard Bridging Light Development Development Commercial

Are you ready to rethink what standard means?

masthaven.co.uk Masthaven Bank Limited is a company registered in England & Wales with registration number 09660012 and whose registered office is at: 11 Soho Street, London W1D 3AD. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (Firm reference number 719354).

26 | NACFB Magazine

The “Masthaven” name and logos and all other brands, names, logos, marks and slogans on this document are the trademarks or service marks of us or our licensors.

CASE STUDIES

Sale & HP back helps keep things moving Case details Broker: Anglo Scottish Asset Finance Ltd Industry: Transport Product solution: Sale and HP back Loan amount: £2.8m

Mark Gilman Senior broker development manager Close Brothers

Our national team of broker development managers works closely with a growing network of business finance brokers and we pride ourselves on our considerable expertise and ability to understand what brokers are looking for to meet their customers’ requirements.

O

ne of our recent cases involved Anglo Scottish Asset Finance Ltd – an independent finance provider offering a variety of financial services, including asset finance. It offers financial support to businesses, whether they are looking to fund expansion, manage cash flow, acquire assets or even organise some personal finance.

Trading locally for over 20 years, Anglo’s customer was a wellestablished vehicle logistics company specialising in car transportation and fleet delivery services. Anglo has worked with the customer many times over the years, developing a longstanding relationship.

Paul Sargent, director at Anglo, introduced the client to me.

Following a historic aggressive repayment policy from their existing lender, the customer was looking to reduce their monthly outgoings and ease the business cash flow.

They have built up an enviable reputation and have been operating for a number of successful years, but last year the company made a small loss due to uncertainty in

the market. Due to the short-term previously taken on agreements, the customer had good equity held in the fleet of vehicles, but wanted to reduce its monthly expenditure by refinancing over a longer term.

Following a tough year, the new agreement would allow the customer to release some cash and remove some of the debt within the business, easing their financial pressure.

Close Brothers Business Finance recommended a £2.8m refinance deal via a sale and HP back product, which has resulted in savings of around £40,000 per month for the customer by releasing capital from existing assets.

Commenting on the deal, Paul said: “The money released from the existing assets has aided our client to consolidate current debts, reduce outgoings and boost capital.

“They can now continue to grow and by working together with Mark and the Close Brothers team, we will hopefully be able to provide further funding for vehicles for our client in the future.”

Following a tough year, the new agreement would allow the customer to release some cash and remove some of the debt within the business, easing their financial pressure

We’re redefining standard

We’ve put a lot of thought into our newly extended suite of short-term lending products.

In an increasingly diverse world we know brokers need maximum flexibility to handle the widest possible range of client scenarios.

Standard bridging that’s anything but standard • • • • •

Prime Bridging Standard Bridging Light Development Development Commercial

Are you ready to rethink what standard means?

masthaven.co.uk Masthaven Bank Limited is a company registered in England & Wales with registration number 09660012 and whose registered office is at: 11 Soho Street, London W1D 3AD. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (Firm reference number 719354).

26 | NACFB Magazine

The “Masthaven” name and logos and all other brands, names, logos, marks and slogans on this document are the trademarks or service marks of us or our licensors.

Fast & flexible funding for your clients from Just Cashflow...

WINNER

RUNNER-UP

OF BEST P2P

MARKETING CAMPAIGN

HIGHLY

BEST

COMMENDED LENDER

flexible funding solutions ✓ Fast, from £10k to £500k

✓

✓ Simple application process of solutions to meet ✓ Range differing client needs

pay interest on the amount ✓ Only drawn down

strong underwriting team and ✓ Abroker relations team to support you and your clients needs

Just call us now

0121 418 5037

Alternatively, find out more

justcashflow.com/partner Patron Member

The FS668057

BCMS668054

Just Cash Flow PLC is registered at 1 Charterhouse Mews, Farringdon, London EC1M 6BB under Company number 08508165 © Just Cash Flow PLC 2018

AWARDS 2018

SHORTLISTED

VOTED

BEST

SERVICE

Fast & flexible funding for your clients from Just Cashflow...

WINNER

RUNNER-UP

OF BEST P2P

MARKETING CAMPAIGN

HIGHLY

BEST

COMMENDED LENDER

flexible funding solutions ✓ Fast, from £10k to £500k

✓

✓ Simple application process of solutions to meet ✓ Range differing client needs

pay interest on the amount ✓ Only drawn down

strong underwriting team and ✓ Abroker relations team to support you and your clients needs

Just call us now

0121 418 5037

Alternatively, find out more

justcashflow.com/partner Patron Member

The FS668057

BCMS668054

Just Cash Flow PLC is registered at 1 Charterhouse Mews, Farringdon, London EC1M 6BB under Company number 08508165 © Just Cash Flow PLC 2018

AWARDS 2018

SHORTLISTED

VOTED

BEST

SERVICE

CASE STUDIES

CASE STUDIES

Supporting an early venture into Help to Buy Richard Doe MD of commercial lending Paragon Banking Group

Paragon considers the development finance market to be particularly attractive, with strong underlying demand based on the shortage of housing in the UK. It’s a market that requires a specialist focus on customer requirements, risk assessment and in-life portfolio management – and our specialist development finance team supports many independent property developers, who are bringing land back into use for muchneeded housing for families.

30 | NACFB Magazine

A

dded to this, we recently bought residential lender Titlestone Property Finance, a leading provider of residential development finance that serves a range of small- and medium-sized residential property developers and which has committed over £2.2bn across more than 330 developments.

Government policy is seeking to improve housing supply in the UK through the construction of 300,000 new homes per year by the mid-2020s. Small- and medium-sized housebuilders account for 41% of all new builds.

However, access to finance remains a major barrier for the majority of SME housebuilders, as larger lenders continue to retrench from the market.

In one of Paragon’s recent deals, we supported independent property developers who were transforming an old council depot in Edenthorpe, Doncaster, into new homes, including some offered under the Help to Buy scheme.

The government created Help to Buy schemes – including Help to Buy: Shared Ownership and Help to Buy: Equity Loan – to help first-time buyers and other people take steps to buy their own home and ease the housing crisis.

We worked closely with brothers Nigel and Darren Griffiths, the directors of Premier Homes (Doncaster) Limited, and their co-directors Steve Mosby Snr and Stephen Mosby from Danum Developments to finance 14 new properties. These were a mix of four-bed houses along with three-bed homes, which were the ones offered under Help to Buy at a price of £165,000.

Providing loans in a simple and clear way to small businesses is what Paragon does well and this means that

developers can have peace of mind that funding is in place and they can concentrate their efforts on more complex aspects of the development.

Paragon’s development finance team provided Premier Homes with a loan of £1.5m against a GDV of around £2.46m. Our funding began in October 2017 with the final repayment in April the following year.

This well-run development came in on cost with all the units sold within a few months of their release, and the three-bed properties offered under the Help to Buy scheme worked particularly well at the price point of £165,000.

Nigel Griffiths, director of Premier Homes (Doncaster), explained to us that this was only the second Help to Buy scheme they had done and it was a learning curve in terms of knowing the sales procedure and how payments would be made from both the mortgage provider and also the Help to Buy body.

What was important to him was knowing that the finance side of things would go smoothly, that the loan was delivered when we said it would be and the drawdown process was turned around promptly.

The development made total sales of £2.5m on the 14 properties and supporting Premier Homes (Doncaster) to venture into Help to Buy schemes felt very worthwhile as it went some way towards creating more affordable new homes for people in the North of England.

At Paragon, the cornerstone of our business is supporting and nurturing small businesses to reach their full potential. As a specialist lender, we have more than 30 years of experience in steering customers into a tailormade loan that is perfect for them.

NACFB Magazine | 31

CASE STUDIES

CASE STUDIES

Supporting an early venture into Help to Buy Richard Doe MD of commercial lending Paragon Banking Group

Paragon considers the development finance market to be particularly attractive, with strong underlying demand based on the shortage of housing in the UK. It’s a market that requires a specialist focus on customer requirements, risk assessment and in-life portfolio management – and our specialist development finance team supports many independent property developers, who are bringing land back into use for muchneeded housing for families.

30 | NACFB Magazine

A

dded to this, we recently bought residential lender Titlestone Property Finance, a leading provider of residential development finance that serves a range of small- and medium-sized residential property developers and which has committed over £2.2bn across more than 330 developments.

Government policy is seeking to improve housing supply in the UK through the construction of 300,000 new homes per year by the mid-2020s. Small- and medium-sized housebuilders account for 41% of all new builds.

However, access to finance remains a major barrier for the majority of SME housebuilders, as larger lenders continue to retrench from the market.

In one of Paragon’s recent deals, we supported independent property developers who were transforming an old council depot in Edenthorpe, Doncaster, into new homes, including some offered under the Help to Buy scheme.

The government created Help to Buy schemes – including Help to Buy: Shared Ownership and Help to Buy: Equity Loan – to help first-time buyers and other people take steps to buy their own home and ease the housing crisis.

We worked closely with brothers Nigel and Darren Griffiths, the directors of Premier Homes (Doncaster) Limited, and their co-directors Steve Mosby Snr and Stephen Mosby from Danum Developments to finance 14 new properties. These were a mix of four-bed houses along with three-bed homes, which were the ones offered under Help to Buy at a price of £165,000.

Providing loans in a simple and clear way to small businesses is what Paragon does well and this means that

developers can have peace of mind that funding is in place and they can concentrate their efforts on more complex aspects of the development.

Paragon’s development finance team provided Premier Homes with a loan of £1.5m against a GDV of around £2.46m. Our funding began in October 2017 with the final repayment in April the following year.

This well-run development came in on cost with all the units sold within a few months of their release, and the three-bed properties offered under the Help to Buy scheme worked particularly well at the price point of £165,000.

Nigel Griffiths, director of Premier Homes (Doncaster), explained to us that this was only the second Help to Buy scheme they had done and it was a learning curve in terms of knowing the sales procedure and how payments would be made from both the mortgage provider and also the Help to Buy body.

What was important to him was knowing that the finance side of things would go smoothly, that the loan was delivered when we said it would be and the drawdown process was turned around promptly.

The development made total sales of £2.5m on the 14 properties and supporting Premier Homes (Doncaster) to venture into Help to Buy schemes felt very worthwhile as it went some way towards creating more affordable new homes for people in the North of England.

At Paragon, the cornerstone of our business is supporting and nurturing small businesses to reach their full potential. As a specialist lender, we have more than 30 years of experience in steering customers into a tailormade loan that is perfect for them.

NACFB Magazine | 31

Patron | profile

When it comes to long-term business finance, Newable delivers Philip Reynolds Managing director Newable

Managing growth – predominantly through accessing competitive business finance – remains the number one challenge facing UK businesses.

32 | NACFB Magazine

T

here are currently far too many hurdles to clear in order to get access to the right funding.

Largely, this barrier can be overcome by an improved understanding as to where funding is available, therefore, it pays to have an experienced lender on your side. At Newable, with over 35 years of experience, we help businesses take the leap.

Each year, we meet thousands of new, exciting businesses that all need support in different ways. It’s from this first-hand experience of the challenges that businesses face that we developed our services, which offer support across four pillars: lending, investing, advice and property.

We know that businesses at the heart of the UK economy are ambitious and looking to grow. However, they often lack the funding or the technical expertise, or don’t know how to go about making the right connections to unlock opportunities within the UK

and overseas. Newable offers worldclass advice and hands-on support with all of the solutions we provide.

in 1982, the team brings solid experience in working with and growing early-stage businesses.

The result is that companies will get the confidence boost they need to take on the world and create a solid pipeline of sustainable and profitable business. Whether you’re starting or scaling your firm, we have a dedicated team that is eager to help you make the next move.

Whichever of our pillars is most relevant to you – and it may be more than one – we’d be delighted to help.

Newable Business Finance (NBF), a joint venture with Liberis, was created to enable underserved UK SMEs to access finance at rates and terms that allow businesses to invest in their own growth. NBF offers loans from £26,000 to £150,000 for up to five years at rates from 12%. Unlike many lenders that advertise five-year terms only to counter-offer to shorter durations, we deliver on our longerterm positioning, with the majority of successful applicants being able to borrow for over five years.

Demystifying finance options for UK businesses Newable offers three core services: angel investment, business loans and sourcing regulated mortgage and development finance.

Newable Private Investing provides early-stage investment for exciting, innovative and tech-focused companies within the UK. Founded

We believe business finance should be fairer, easier and more accessible for companies of all shapes and sizes. That’s why we get to know the full story. As a leading provider of responsible finance to UK SMEs, Newable looks to understand the background to applications and

where many lenders may decline them due to a scorecard-based approach, our underwriting team will look at all eligible applications.

We know many companies miss out on opportunities for their business because they don’t have access to the right type of finance at the time they need it. A core part of our purpose is to support UK SMEs where others won’t.

In practice, this means that Newable can look to support applications where other lenders may feel there is inadequate security, either from the business or from the director(s).

To support these cases, Newable relies upon its accreditation with the British Business Bank Enterprise Finance Guarantee scheme.

We aim to get businesses the finance they need – fast – so they can get on with running their business. Since Newable assesses each deal on its own merits, we can consider a broad range of securities. Historically, we

have been able to offer competitive rates to business borrowers by accessing the residual equity in owner-occupied commercial properties, or available equity in directors’ buy-to-let portfolios.

All of our loan products are simple to understand, have no late fees or punitive interest rates and can be settled (in full or partially) at any point without penalty.

Working together Newable understands the important role introducers play in the SME finance market. We appreciate that many of your customers are a result of years of personal relationship building and we aim to keep you informed throughout the process.

That’s why we make it as easy as possible for you, too. Our online portal allows introducers to submit and track deals, while our multi-skilled team is only a phone call away.

NACFB Magazine | 33

Patron | profile

When it comes to long-term business finance, Newable delivers Philip Reynolds Managing director Newable

Managing growth – predominantly through accessing competitive business finance – remains the number one challenge facing UK businesses.

32 | NACFB Magazine

T

here are currently far too many hurdles to clear in order to get access to the right funding.

Largely, this barrier can be overcome by an improved understanding as to where funding is available, therefore, it pays to have an experienced lender on your side. At Newable, with over 35 years of experience, we help businesses take the leap.

Each year, we meet thousands of new, exciting businesses that all need support in different ways. It’s from this first-hand experience of the challenges that businesses face that we developed our services, which offer support across four pillars: lending, investing, advice and property.

We know that businesses at the heart of the UK economy are ambitious and looking to grow. However, they often lack the funding or the technical expertise, or don’t know how to go about making the right connections to unlock opportunities within the UK

and overseas. Newable offers worldclass advice and hands-on support with all of the solutions we provide.

in 1982, the team brings solid experience in working with and growing early-stage businesses.

The result is that companies will get the confidence boost they need to take on the world and create a solid pipeline of sustainable and profitable business. Whether you’re starting or scaling your firm, we have a dedicated team that is eager to help you make the next move.

Whichever of our pillars is most relevant to you – and it may be more than one – we’d be delighted to help.

Newable Business Finance (NBF), a joint venture with Liberis, was created to enable underserved UK SMEs to access finance at rates and terms that allow businesses to invest in their own growth. NBF offers loans from £26,000 to £150,000 for up to five years at rates from 12%. Unlike many lenders that advertise five-year terms only to counter-offer to shorter durations, we deliver on our longerterm positioning, with the majority of successful applicants being able to borrow for over five years.

Demystifying finance options for UK businesses Newable offers three core services: angel investment, business loans and sourcing regulated mortgage and development finance.

Newable Private Investing provides early-stage investment for exciting, innovative and tech-focused companies within the UK. Founded

We believe business finance should be fairer, easier and more accessible for companies of all shapes and sizes. That’s why we get to know the full story. As a leading provider of responsible finance to UK SMEs, Newable looks to understand the background to applications and

where many lenders may decline them due to a scorecard-based approach, our underwriting team will look at all eligible applications.

We know many companies miss out on opportunities for their business because they don’t have access to the right type of finance at the time they need it. A core part of our purpose is to support UK SMEs where others won’t.

In practice, this means that Newable can look to support applications where other lenders may feel there is inadequate security, either from the business or from the director(s).

To support these cases, Newable relies upon its accreditation with the British Business Bank Enterprise Finance Guarantee scheme.

We aim to get businesses the finance they need – fast – so they can get on with running their business. Since Newable assesses each deal on its own merits, we can consider a broad range of securities. Historically, we

have been able to offer competitive rates to business borrowers by accessing the residual equity in owner-occupied commercial properties, or available equity in directors’ buy-to-let portfolios.

All of our loan products are simple to understand, have no late fees or punitive interest rates and can be settled (in full or partially) at any point without penalty.

Working together Newable understands the important role introducers play in the SME finance market. We appreciate that many of your customers are a result of years of personal relationship building and we aim to keep you informed throughout the process.

That’s why we make it as easy as possible for you, too. Our online portal allows introducers to submit and track deals, while our multi-skilled team is only a phone call away.

NACFB Magazine | 33

Ask | the expert Your questions answered by the most knowledgeable industry insiders

Giving in to the hype Emma Hall, head of sales at GWlegal, on why brokers should build relationships with firms – both online and offline

Q A

Online or in-person?

Why do we need to choose? When we talk about tech, we always talk as though it’s taking over human interaction – a robot-type experience.

That’s absolutely not the case in my eyes and to my firm. Good tech is an extension of good interpersonal experiences. The two aren’t mutually exclusive. At GWlegal, for example, we have a brilliant team (of humans, not robots) behind our IT. Our social media reflects our values we hold personally as a firm, and allows us to quickly and easily communicate with our brokers and clients, just as we would while chatting on the phone.

Our website gives our stakeholders easy access to our team members – displaying their photographs and bios. Instagram shows our staff at work. Twitter enables us to build relationships with our brokers on a closer level than ever before, as we ‘like’ and comment on their professional and personal content. Through Facebook we use sponsored adverts to reach new clients, whom we then speak with personally and assist with very personal matters such as buying their first home or setting up a limited company for their buy-to-let ventures. Our online case management system for brokers – GWlive – means those instructing cases can do so instantly, and see the case’s progress in real time. Everything’s transparent. Tech allows that, more so than when in-person, ironically enough.

34 | NACFB Magazine

That’s not to say we don’t love speaking to our brokers and clients on the phone or meeting with them personally. This too is invaluable – but it’s not the be-all and end-all and I passionately believe that all property professionals must be viewing tech – and their digital presence – as an extension of them, as people or as firms.

– interactions online and on social media are virtually the same as those in real life. Comment on the content of your partners. Tag them in relevant posts. Take photographs after successful meetings and share them. When you speak with a colleague on the phone or via email, mention things you’ve seen on social media.

Encourage that dialogue, on- and offline.

Q

Q

A

A

As property professionals, how can we balance that professionalism with the personal?

In the age of the internet, iPhones and Instagram, is this even a question we should be asking any more? Modernday consumers no longer want stiff, impersonal interactions with the businesses they interact with. Firms and brokers don’t either. We must all be sharing more of ourselves (in a business-appropriate manner, of course. I don’t care so much what you did on Friday night at the pub) – whether that’s simply by reposting an editorial from the industry press you agree with on LinkedIn or Instagramming snaps of you and your workmates after a productive day in the office. Otherwise, why would we expect anything else in return from our clients and colleagues?

Q A

Practically, how can I build better professional relationships online?

First thing’s first, you need a good online presence yourself. Develop your social media profiles, post on them regularly and follow profiles that matter. Second, employ common sense

Why should brokers develop closer relationships with the firms they work with?

It’s true that the online world means professional boundaries are being pushed further than ever before – I often know what a broker has had for breakfast before I arrive for our morning meeting, for example. Eating habits aside, though, there are so many reasons; from making your everyday work experience more pleasant to being able to better benefit from the years of experience and specialist knowledge those you work with probably have (GWlegal has been around for almost 35 years, for instance).

Residential conveyancing, buy-to-let and limited company transactions are by no means easy. Things just aren’t going to work if you don’t build a solid relationship with everybody involved in the chain – online and offline. Period.

Tab closed. That’s me, logging off.

One new low monthly interest rate for all bridging loans regardless of LTV Residential • Commercial

Lets Talk!

Ask | the expert Your questions answered by the most knowledgeable industry insiders

Giving in to the hype Emma Hall, head of sales at GWlegal, on why brokers should build relationships with firms – both online and offline

Q A

Online or in-person?

Why do we need to choose? When we talk about tech, we always talk as though it’s taking over human interaction – a robot-type experience.

That’s absolutely not the case in my eyes and to my firm. Good tech is an extension of good interpersonal experiences. The two aren’t mutually exclusive. At GWlegal, for example, we have a brilliant team (of humans, not robots) behind our IT. Our social media reflects our values we hold personally as a firm, and allows us to quickly and easily communicate with our brokers and clients, just as we would while chatting on the phone.

Our website gives our stakeholders easy access to our team members – displaying their photographs and bios. Instagram shows our staff at work. Twitter enables us to build relationships with our brokers on a closer level than ever before, as we ‘like’ and comment on their professional and personal content. Through Facebook we use sponsored adverts to reach new clients, whom we then speak with personally and assist with very personal matters such as buying their first home or setting up a limited company for their buy-to-let ventures. Our online case management system for brokers – GWlive – means those instructing cases can do so instantly, and see the case’s progress in real time. Everything’s transparent. Tech allows that, more so than when in-person, ironically enough.

34 | NACFB Magazine

That’s not to say we don’t love speaking to our brokers and clients on the phone or meeting with them personally. This too is invaluable – but it’s not the be-all and end-all and I passionately believe that all property professionals must be viewing tech – and their digital presence – as an extension of them, as people or as firms.

– interactions online and on social media are virtually the same as those in real life. Comment on the content of your partners. Tag them in relevant posts. Take photographs after successful meetings and share them. When you speak with a colleague on the phone or via email, mention things you’ve seen on social media.

Encourage that dialogue, on- and offline.

Q

Q

A

A

As property professionals, how can we balance that professionalism with the personal?

In the age of the internet, iPhones and Instagram, is this even a question we should be asking any more? Modernday consumers no longer want stiff, impersonal interactions with the businesses they interact with. Firms and brokers don’t either. We must all be sharing more of ourselves (in a business-appropriate manner, of course. I don’t care so much what you did on Friday night at the pub) – whether that’s simply by reposting an editorial from the industry press you agree with on LinkedIn or Instagramming snaps of you and your workmates after a productive day in the office. Otherwise, why would we expect anything else in return from our clients and colleagues?

Q A

Practically, how can I build better professional relationships online?

First thing’s first, you need a good online presence yourself. Develop your social media profiles, post on them regularly and follow profiles that matter. Second, employ common sense

Why should brokers develop closer relationships with the firms they work with?

It’s true that the online world means professional boundaries are being pushed further than ever before – I often know what a broker has had for breakfast before I arrive for our morning meeting, for example. Eating habits aside, though, there are so many reasons; from making your everyday work experience more pleasant to being able to better benefit from the years of experience and specialist knowledge those you work with probably have (GWlegal has been around for almost 35 years, for instance).

Residential conveyancing, buy-to-let and limited company transactions are by no means easy. Things just aren’t going to work if you don’t build a solid relationship with everybody involved in the chain – online and offline. Period.

Tab closed. That’s me, logging off.

One new low monthly interest rate for all bridging loans regardless of LTV Residential • Commercial

Lets Talk!

Special | features

Jonathan Sealey CEO Hope Capital

An up-to-date insight into the industry

O It is only through communication that we learn; only through really listening that we can take steps to improve things Hope Capital CEO Jonathan Sealey on the importance of continuing to talk to - and educate - one another

ne of the key things that the NACFB is known for is bringing brokers and lenders together to discuss frustrations and issues. These conversations nearly always result in great learning and deeper understanding, and often lead to positive outcomes in the form of changed behaviours on both sides.

Education has to be a continual process.

We do not usually expect a borrower to understand all the ins and outs of taking out a bridging or commercial loan. We are prepared to help and guide them through the process to achieve a successful conclusion, but maybe lenders and brokers assume a level of knowledge about each other that may not always be justified. After all, every lender has different criteria, different rates and different ways of working – so it stands to reason that not every broker will be familiar with the peculiarities and idiosyncrasies of each one.

Similarly, lenders may not be as familiar as they may like to be with the working habits and knowledge of every broker.

And, of course, every broker has a different background, different specialisms and is used to dealing in a different way.

The answer has to be two-way communication. This enables further understanding for both sides and new ways of working, with the ultimate aim of improving things for the borrower – so that we all work together in their best interests.

Ultimately, it is only through communication that we learn; only through really listening that we can take steps to improve things, and through collaboration on both sides to work as a team, rather than as opposing forces.

After all, we all have a common goal: the borrower wants a loan and both broker and lender want to help them achieve this.

So let us look at those needs in detail.

A broker’s wants and needs: costs, completion and access to an underwriter Brokers fundamentally want to know that a lender will lend to their clients; what their rates and fees are, what the time to completion will be and, once a lender has given a decision in principle, that a ‘yes’ means that lender is going to come up with the money – as long as nothing significant changes.

36 | NACFB Magazine

NACFB Magazine | 37

Special | features

Jonathan Sealey CEO Hope Capital

An up-to-date insight into the industry

O It is only through communication that we learn; only through really listening that we can take steps to improve things Hope Capital CEO Jonathan Sealey on the importance of continuing to talk to - and educate - one another

ne of the key things that the NACFB is known for is bringing brokers and lenders together to discuss frustrations and issues. These conversations nearly always result in great learning and deeper understanding, and often lead to positive outcomes in the form of changed behaviours on both sides.

Education has to be a continual process.

We do not usually expect a borrower to understand all the ins and outs of taking out a bridging or commercial loan. We are prepared to help and guide them through the process to achieve a successful conclusion, but maybe lenders and brokers assume a level of knowledge about each other that may not always be justified. After all, every lender has different criteria, different rates and different ways of working – so it stands to reason that not every broker will be familiar with the peculiarities and idiosyncrasies of each one.

Similarly, lenders may not be as familiar as they may like to be with the working habits and knowledge of every broker.

And, of course, every broker has a different background, different specialisms and is used to dealing in a different way.

The answer has to be two-way communication. This enables further understanding for both sides and new ways of working, with the ultimate aim of improving things for the borrower – so that we all work together in their best interests.

Ultimately, it is only through communication that we learn; only through really listening that we can take steps to improve things, and through collaboration on both sides to work as a team, rather than as opposing forces.

After all, we all have a common goal: the borrower wants a loan and both broker and lender want to help them achieve this.

So let us look at those needs in detail.

A broker’s wants and needs: costs, completion and access to an underwriter Brokers fundamentally want to know that a lender will lend to their clients; what their rates and fees are, what the time to completion will be and, once a lender has given a decision in principle, that a ‘yes’ means that lender is going to come up with the money – as long as nothing significant changes.

36 | NACFB Magazine

NACFB Magazine | 37

SPECIAL FEATURES

What can Conister do for you...

Wholesale Funding Asset Finance Block Discounting Commercial Loans Premium Finance Personal Loans

Typically, most brokers also want to know they can speak to a decision maker about the case, especially if it is a less than usual case or there are complications.

Of course, ideals such as lower rates, higher LTVs and longer loan duration will always be requested, but outside of this, being able to get the loan through and completed when you need it has to be paramount.

I completely understand the frustration of brokers whose reputation with their client is put in jeopardy because a lender has said that it will lend on a property, only to change its mind at the eleventh hour.

This should never be the case, but we get an increasing number of such cases come into Hope Capital where another lender has done exactly this. No matter how low a rate may be on paper, it is worthless if the lender cannot actually deliver the loan.

38 | NACFB Magazine

A lender’s needs: facts and an exit route So what does a lender need? Key for most lenders is to know all the details of a case upfront, and for those details to be factual, accurate and complete.

There are few things more frustrating to a lender than to underwrite a case, be ready to lend on it and then find that a new piece of information comes to light, or that something it had been told isn’t accurate, which changes everything so it has to go back to square one.

The other ideal for a lender is for the broker to help their client with their exit route – even before they have taken their bridging loan out. This may be by arranging a longer-term loan in principle or just ensuring the borrower knows when they have to pay their bridging loan back through a sale. This is such an important element that at Hope Capital, we even pay higher procuration fees for brokers who manage this successfully.

Of course, these things are the basics and both a lender’s and a broker’s wants and needs will change as the market evolves and clients’ needs change. Key is for all parties to keep talking, keep letting each other know what they need and then work together to achieve the best outcome. This is where the NACFB has such a vital role in creating forums and events: to enable this to happen, for the benefit of everyone.

Competitive rates - Quick Decisions For further details: telephone 01624 694694 email info@conisterbank.co.im or visit www.conisterbank.co.im Conister Bank Limited. Registered in the Isle of Man No. 000738C. Registered Office: Clarendon House, Victoria Street, Douglas, Isle of Man, IM1 2LN. Conister Bank Limited is licensed by the Isle of Man Financial Services Authority for its deposit taking activities and is authorised and regulated in the United Kingdom by the Financial Conduct Authority for its consumer credit activities and mortgage lending administration, firm registration number 619002.

SPECIAL FEATURES

What can Conister do for you...

Wholesale Funding Asset Finance Block Discounting Commercial Loans Premium Finance Personal Loans

Typically, most brokers also want to know they can speak to a decision maker about the case, especially if it is a less than usual case or there are complications.

Of course, ideals such as lower rates, higher LTVs and longer loan duration will always be requested, but outside of this, being able to get the loan through and completed when you need it has to be paramount.

I completely understand the frustration of brokers whose reputation with their client is put in jeopardy because a lender has said that it will lend on a property, only to change its mind at the eleventh hour.

This should never be the case, but we get an increasing number of such cases come into Hope Capital where another lender has done exactly this. No matter how low a rate may be on paper, it is worthless if the lender cannot actually deliver the loan.

38 | NACFB Magazine

A lender’s needs: facts and an exit route So what does a lender need? Key for most lenders is to know all the details of a case upfront, and for those details to be factual, accurate and complete.

There are few things more frustrating to a lender than to underwrite a case, be ready to lend on it and then find that a new piece of information comes to light, or that something it had been told isn’t accurate, which changes everything so it has to go back to square one.

The other ideal for a lender is for the broker to help their client with their exit route – even before they have taken their bridging loan out. This may be by arranging a longer-term loan in principle or just ensuring the borrower knows when they have to pay their bridging loan back through a sale. This is such an important element that at Hope Capital, we even pay higher procuration fees for brokers who manage this successfully.

Of course, these things are the basics and both a lender’s and a broker’s wants and needs will change as the market evolves and clients’ needs change. Key is for all parties to keep talking, keep letting each other know what they need and then work together to achieve the best outcome. This is where the NACFB has such a vital role in creating forums and events: to enable this to happen, for the benefit of everyone.

Competitive rates - Quick Decisions For further details: telephone 01624 694694 email info@conisterbank.co.im or visit www.conisterbank.co.im Conister Bank Limited. Registered in the Isle of Man No. 000738C. Registered Office: Clarendon House, Victoria Street, Douglas, Isle of Man, IM1 2LN. Conister Bank Limited is licensed by the Isle of Man Financial Services Authority for its deposit taking activities and is authorised and regulated in the United Kingdom by the Financial Conduct Authority for its consumer credit activities and mortgage lending administration, firm registration number 619002.

SPECIAL FEATURES

SPECIAL FEATURES

56% of brokers are frustrated with lenders’ inconsistencies

Matthew Tooth Chief commercial officer LendInvest

Understanding your client – whether that is the broker or the borrower – is imperative in fine-tuning and improving your customer experience as a lender.

40 | NACFB Magazine

B

ack in late June, we surveyed a pool of brokers at the NACFB Commercial Finance Expo, asking what frustrates them the most about the specialist finance market right now. Over half of participating brokers (56%) came back naming lenders changing their mind on a deal as their number one issue.

Taking over from another lender that has either let a client down or has frustrated them with a slow decision-making process is something we have repeatedly dealt with at LendInvest. This is why we make sure we are always striving to prevent our brokers and borrowers from facing the same frustration.

Building and maintaining an efficient line of communication between brokers and the underwriting, sales and credit teams – even in the primary stages of a

deal – is key in preventing disappointment for a borrower. Of course, circumstances can always change, however, taking the time to properly review a case and stick to the decision in principle will prevent larger disruptions down the line.

Transparency is required now more than ever. Brokers need to be able to assure their client that once a decision in principle is issued – subject to the information the lender requires – the lender is, in fact, looking to lend and not put obstacles in the way.

Lack of good service claimed almost a quarter of the brokers’ votes (24%), signalling there is still work to be done from a customer service perspective in the specialist lending industry. Industry bodies such as the NACFB are paramount in battling this, acting as a proactive

advocate for both lender and broker education, promoting the benefits of good practice for each stakeholder in a deal.

Lenders can equally be more proactive when forming their role and relationship with brokers. For brokers, keeping on top of the different product details and criteria of mainstream lenders is difficult enough, let alone the varying terms employed by lenders operating in more specialised areas. There is far more to providing quality mortgage advice than simply firing up a sourcing system and performing a quick search.

As the specialist market grows, it is up to lenders to do more to help brokers keep up to speed on the ever-evolving product ranges, and how those products can help, with specific examples of exactly what we will – or won’t – be able to lend on.

taking the time to properly review a case and stick to the decision in principle will prevent larger disruptions

Finally, rates not being good enough was an issue for only 14% of respondents.

This is something that will eternally be an issue based on lenders’ ability to drive down their cost of capital; as the market becomes increasingly competitive, there will be a new lender everyday with better rates. What is interesting to take note of, however, is the fact that this is the issue that frustrated brokers the least, proving service is priceless in this industry.

Lenders will always be seeking new ways to bring their cost of capital down to deliver better rates for their clients, but they mustn’t forget that their clients won’t return if they have received poor service in the interim.

down the line

NACFB Magazine | 41

SPECIAL FEATURES

SPECIAL FEATURES

56% of brokers are frustrated with lenders’ inconsistencies

Matthew Tooth Chief commercial officer LendInvest

Understanding your client – whether that is the broker or the borrower – is imperative in fine-tuning and improving your customer experience as a lender.

40 | NACFB Magazine

B

ack in late June, we surveyed a pool of brokers at the NACFB Commercial Finance Expo, asking what frustrates them the most about the specialist finance market right now. Over half of participating brokers (56%) came back naming lenders changing their mind on a deal as their number one issue.

Taking over from another lender that has either let a client down or has frustrated them with a slow decision-making process is something we have repeatedly dealt with at LendInvest. This is why we make sure we are always striving to prevent our brokers and borrowers from facing the same frustration.

Building and maintaining an efficient line of communication between brokers and the underwriting, sales and credit teams – even in the primary stages of a

deal – is key in preventing disappointment for a borrower. Of course, circumstances can always change, however, taking the time to properly review a case and stick to the decision in principle will prevent larger disruptions down the line.

Transparency is required now more than ever. Brokers need to be able to assure their client that once a decision in principle is issued – subject to the information the lender requires – the lender is, in fact, looking to lend and not put obstacles in the way.

Lack of good service claimed almost a quarter of the brokers’ votes (24%), signalling there is still work to be done from a customer service perspective in the specialist lending industry. Industry bodies such as the NACFB are paramount in battling this, acting as a proactive

advocate for both lender and broker education, promoting the benefits of good practice for each stakeholder in a deal.

Lenders can equally be more proactive when forming their role and relationship with brokers. For brokers, keeping on top of the different product details and criteria of mainstream lenders is difficult enough, let alone the varying terms employed by lenders operating in more specialised areas. There is far more to providing quality mortgage advice than simply firing up a sourcing system and performing a quick search.

As the specialist market grows, it is up to lenders to do more to help brokers keep up to speed on the ever-evolving product ranges, and how those products can help, with specific examples of exactly what we will – or won’t – be able to lend on.

taking the time to properly review a case and stick to the decision in principle will prevent larger disruptions

Finally, rates not being good enough was an issue for only 14% of respondents.

This is something that will eternally be an issue based on lenders’ ability to drive down their cost of capital; as the market becomes increasingly competitive, there will be a new lender everyday with better rates. What is interesting to take note of, however, is the fact that this is the issue that frustrated brokers the least, proving service is priceless in this industry.

Lenders will always be seeking new ways to bring their cost of capital down to deliver better rates for their clients, but they mustn’t forget that their clients won’t return if they have received poor service in the interim.

down the line

NACFB Magazine | 41

SPECIAL FEATURES

SPECIAL FEATURES

The view from Ireland Michael Mooney Managing director Sancus BMS (Ireland)

42 | NACFB Magazine

Sancus BMS enters the Irish property lending market at a time when the sector presents an attractive landscape for alternative lenders and brokers alike. The favourable conditions that underpin the sector include a buoyant economy that has robustly rebounded from recession; structural shortages in the supply of most property asset classes (enhancing the attractiveness of individual lending cases); a substantial overhang of legacy loans that require refinancing; a substantially reduced level of competition from the core ‘pillar banks’; and a large population of potential borrowers who have a need for experienced advisers with good access to alternative sources of finance.

NACFB Magazine | 43

SPECIAL FEATURES

SPECIAL FEATURES

The view from Ireland Michael Mooney Managing director Sancus BMS (Ireland)

42 | NACFB Magazine

Sancus BMS enters the Irish property lending market at a time when the sector presents an attractive landscape for alternative lenders and brokers alike. The favourable conditions that underpin the sector include a buoyant economy that has robustly rebounded from recession; structural shortages in the supply of most property asset classes (enhancing the attractiveness of individual lending cases); a substantial overhang of legacy loans that require refinancing; a substantially reduced level of competition from the core ‘pillar banks’; and a large population of potential borrowers who have a need for experienced advisers with good access to alternative sources of finance.

NACFB Magazine | 43

SPECIAL FEATURES

Establishment of the ‘bad banks’ The current conditions have their roots in the dislocation that occurred to both the property and lending sectors as a result of the crash of 2008 to 2011. Both sectors continue to evolve in response to the challenges this period created.

The dislocation on the banking sector was extreme: loans with a par value of circa €70bn (approximately £53bn) were transferred from Irish-owned banks to a government-established ‘bad bank’, the National Asset Management Agency NAMA) for circa €32bn (approximately £24bn) resulting in the Irish government having to nationalise and recapitalise each transferee bank. A similar scale of losses were recorded in the foreignowned banks (Ulster Bank, Bank of Scotland, Danske, Rabobank) with each of these establishing their own standalone Irish ‘bad banking’ units.

With economic recovery, the Irish banks slowly began to generate profits once again

A resilient economy Post the transfers, NAMA and the other ‘bad banks’ realised the enormity of their tasks and Ireland entered recession.

However, the non-property related element of the economy quickly displayed its resilience. Growth rates were modest initially, but underpinned by Ireland’s established and leading position as a location for foreign direct investment, particularly in financial services, pharmaceutical and IT (among others), growth began to increase substantially. The continued success of these sectors and their ripple effect into the wider economy drove the rate of GDP growth to an average of above 10% per annum between 2014 and 2017. Ireland was the fastest-growing economy in Europe during this period.

Severe housing supply shortage Occupier demand for property returned and strengthened with this economic growth.

The Irish property sector, impaired from the crash and preoccupied with the ‘bad banks’, was poorly placed to service this buoyant demand. As a result, structural supply shortages began to manifest across most property asset classes. While fresh capital did arrive from abroad to ease the challenges, much of it was focused on institutional offices. Structural supply challenges continue across other asset classes, most severely in residential housing, where supply is at crisis level.

the carrying value of its original loan book has been retired. Some of the reduction has come through enforcement/direct sale of assets; however, a large element has also come about from the sale of loan books to private equity funded ‘workout vehicles’.

These vehicles are actually undertaking the granular and time-consuming task of working through positions on a loan-byloan and/or connection-by-connection basis. Therefore, the ‘bad banks’ have been successful in profitably reducing their holds.

However, much underlying property still remains in these ‘workout vehicles’, secured on legacy loans, with economic interest, control and investment/strategic direction (of the subject properties) still in limbo. This is particularly true of properties/loans in the sub-€10m (approximately £9m) space.

Irish banks remain cautious With economic recovery, the Irish banks slowly began to generate profits once again. They also cautiously returned to funding property transactions. However, they predominantly operate at the larger ticket and prime end of the property market. They have limited (if any) appetite to refinance borrowers from ‘workout vehicles’ and quite reduced appetite to finance smaller-scale residential developers, who are key to solving the housing shortage. With this avenue of finance not available, these types of borrower are turning to alternative lenders and to experienced advisers/brokers with the structuring skill set and contacts necessary to access finance from alternatives.

Meet the NatWest Broker Development Team We’re expanding to support you further Contact your local Broker Development Manager, or Search NatWest Brokers for more information Our new team member

Territory: Phone Number: South and 07799 868 302 West Wales Email address Joanne.aplin@natwest.com Sarah Delo

Ben Davey

Norfolk, Suffolk, Cambridgeshire, Bedfordshire & Hertfordshire South Lincolnshire, Leicestershire, Northamptonshire, Rutland, North Buckinghamshire & Warwickshire Simon Steer

Phone Number: 07876 331 776

Email address: Vicky.fraser@natwest.com

Territory: South West

Phone Number: 07818 427 117

Email address Dave.furnival@natwest.com

Email address Ian.tudor@natwest.com Additional Towns covered: Hampshire, Dorset, Oxfordshire, Berkshire, Buckinghamshire, The Chilterns

Territory: London

Mark Dobson Phone Number: 07825 781 719

Email address Mark.dobson@natwest.com Additional Towns covered: Essex

Territory: Midlands

Phone Number: 07767 647 411

Email address Andre.parcian@natwest.com Additional Towns covered: East and West Midlands, Derbyshire, North Worcestershire Nicholas Shepherd

Phone Number: 07796 191 992

Territory: South West

Phone Number: 07799 868 614

Email address Nicholas.shepherd@natwest.com Additional Towns covered: Devon, Cornwall & Somerset Neil Southern

Phone Number: 07909 621 204

Territory: London

Phone Number: 07909 007 389

Email address Jayne.a.king@natwest.com

Email address Neil.southern@rbs.co.uk

Additional Towns covered: Surrey and Sussex – including: Putney, Wimbledon, Weybridge, Richmond, Kingston Upon Thames, Sutton, Croydon, Woking, Guildford, Godalming, Reigate, Crawley, Hove, Brighton, Chichester, Epsom

Additional Towns covered: Within M25, Middlesex, mainly Central London, north of Thames, plus East Bucks, SW Herts and W.Essex

Ian Pottle Phone Number: 07342 057 934

Additional Towns covered: North East England & Yorkshire

Territory: Midlands

Territory: UK

Jayne King Phone Number: 07824 857 648

Email address Ben.davey@natwest.com Additional Towns covered:

Territory: North East England Email address Simon.steer@rbs.co.uk

Vicky Fraser Business Support Manager

Ian Tudor Phone Number: 07920 274 207

Email address Sarah.delo@rbs.co.uk Additional Towns covered Scotland

Territory: Midlands

Territory: UK

Andre Parcian

Jo Kinsey

Territory: Scotland

Dave Furnival Head of Broker Channel

Territory: Wales and South West Email address Ian.pottle@natwest.com

John Bridger Phone Number: 07765 033 169

Additional Towns covered: Bristol, Cheltenham, Swindon, Gloucestershire, Wiltshire, South Worcestershire, Herefordshire Steve Darbyshire Territory: Phone Number: North West – 07557 542 803 Greater Manchester Email address Steven.darbyshire@natwest.com Additional Towns covered: Greater Manchester, Stockport, Blackburn, Burnley, Bury, Oldham, Glossop, Sale, Altrincham, Hale, Wilmslow, Nottingham

Territory: Phone Number: London South East 07468 763 790 Email address John.bridger@natwest.con Additional Towns covered: Kent and East Sussex Maria Fraughan Territory: Northwest and Wirral

Phone Number: 07500 608 337

Email address Maria.fraughan@natwest.com Additional Towns covered: Warrington St Helens, Chester and south Cheshire Wirral Blackpool , Preston North Wales, Southport

Workout vehicles Economic recovery also created the conditions that NAMA and the other ‘bad banks’ required to reduce their loan books.

Progress has been impressive: in its last annual report, NAMA outlined that 90% of

44 | NACFB Magazine

Security may be required. Product fees may apply. Over 18s only.

National Westminster Bank Plc. Registered in England & Wales No. 929027. Registered Office: 135 Bishopsgate, London EC2M 3UR.

SPECIAL FEATURES

Establishment of the ‘bad banks’ The current conditions have their roots in the dislocation that occurred to both the property and lending sectors as a result of the crash of 2008 to 2011. Both sectors continue to evolve in response to the challenges this period created.

The dislocation on the banking sector was extreme: loans with a par value of circa €70bn (approximately £53bn) were transferred from Irish-owned banks to a government-established ‘bad bank’, the National Asset Management Agency NAMA) for circa €32bn (approximately £24bn) resulting in the Irish government having to nationalise and recapitalise each transferee bank. A similar scale of losses were recorded in the foreignowned banks (Ulster Bank, Bank of Scotland, Danske, Rabobank) with each of these establishing their own standalone Irish ‘bad banking’ units.

With economic recovery, the Irish banks slowly began to generate profits once again

A resilient economy Post the transfers, NAMA and the other ‘bad banks’ realised the enormity of their tasks and Ireland entered recession.

However, the non-property related element of the economy quickly displayed its resilience. Growth rates were modest initially, but underpinned by Ireland’s established and leading position as a location for foreign direct investment, particularly in financial services, pharmaceutical and IT (among others), growth began to increase substantially. The continued success of these sectors and their ripple effect into the wider economy drove the rate of GDP growth to an average of above 10% per annum between 2014 and 2017. Ireland was the fastest-growing economy in Europe during this period.

Severe housing supply shortage Occupier demand for property returned and strengthened with this economic growth.

The Irish property sector, impaired from the crash and preoccupied with the ‘bad banks’, was poorly placed to service this buoyant demand. As a result, structural supply shortages began to manifest across most property asset classes. While fresh capital did arrive from abroad to ease the challenges, much of it was focused on institutional offices. Structural supply challenges continue across other asset classes, most severely in residential housing, where supply is at crisis level.

the carrying value of its original loan book has been retired. Some of the reduction has come through enforcement/direct sale of assets; however, a large element has also come about from the sale of loan books to private equity funded ‘workout vehicles’.

These vehicles are actually undertaking the granular and time-consuming task of working through positions on a loan-byloan and/or connection-by-connection basis. Therefore, the ‘bad banks’ have been successful in profitably reducing their holds.

However, much underlying property still remains in these ‘workout vehicles’, secured on legacy loans, with economic interest, control and investment/strategic direction (of the subject properties) still in limbo. This is particularly true of properties/loans in the sub-€10m (approximately £9m) space.

Irish banks remain cautious With economic recovery, the Irish banks slowly began to generate profits once again. They also cautiously returned to funding property transactions. However, they predominantly operate at the larger ticket and prime end of the property market. They have limited (if any) appetite to refinance borrowers from ‘workout vehicles’ and quite reduced appetite to finance smaller-scale residential developers, who are key to solving the housing shortage. With this avenue of finance not available, these types of borrower are turning to alternative lenders and to experienced advisers/brokers with the structuring skill set and contacts necessary to access finance from alternatives.

Meet the NatWest Broker Development Team We’re expanding to support you further Contact your local Broker Development Manager, or Search NatWest Brokers for more information Our new team member

Territory: Phone Number: South and 07799 868 302 West Wales Email address Joanne.aplin@natwest.com Sarah Delo

Ben Davey

Norfolk, Suffolk, Cambridgeshire, Bedfordshire & Hertfordshire South Lincolnshire, Leicestershire, Northamptonshire, Rutland, North Buckinghamshire & Warwickshire Simon Steer

Phone Number: 07876 331 776

Email address: Vicky.fraser@natwest.com

Territory: South West

Phone Number: 07818 427 117

Email address Dave.furnival@natwest.com

Email address Ian.tudor@natwest.com Additional Towns covered: Hampshire, Dorset, Oxfordshire, Berkshire, Buckinghamshire, The Chilterns

Territory: London

Mark Dobson Phone Number: 07825 781 719

Email address Mark.dobson@natwest.com Additional Towns covered: Essex

Territory: Midlands

Phone Number: 07767 647 411

Email address Andre.parcian@natwest.com Additional Towns covered: East and West Midlands, Derbyshire, North Worcestershire Nicholas Shepherd

Phone Number: 07796 191 992

Territory: South West

Phone Number: 07799 868 614

Email address Nicholas.shepherd@natwest.com Additional Towns covered: Devon, Cornwall & Somerset Neil Southern

Phone Number: 07909 621 204

Territory: London

Phone Number: 07909 007 389

Email address Jayne.a.king@natwest.com

Email address Neil.southern@rbs.co.uk

Additional Towns covered: Surrey and Sussex – including: Putney, Wimbledon, Weybridge, Richmond, Kingston Upon Thames, Sutton, Croydon, Woking, Guildford, Godalming, Reigate, Crawley, Hove, Brighton, Chichester, Epsom

Additional Towns covered: Within M25, Middlesex, mainly Central London, north of Thames, plus East Bucks, SW Herts and W.Essex

Ian Pottle Phone Number: 07342 057 934

Additional Towns covered: North East England & Yorkshire

Territory: Midlands

Territory: UK

Jayne King Phone Number: 07824 857 648

Email address Ben.davey@natwest.com Additional Towns covered:

Territory: North East England Email address Simon.steer@rbs.co.uk

Vicky Fraser Business Support Manager

Ian Tudor Phone Number: 07920 274 207

Email address Sarah.delo@rbs.co.uk Additional Towns covered Scotland

Territory: Midlands

Territory: UK

Andre Parcian

Jo Kinsey

Territory: Scotland

Dave Furnival Head of Broker Channel

Territory: Wales and South West Email address Ian.pottle@natwest.com

John Bridger Phone Number: 07765 033 169

Additional Towns covered: Bristol, Cheltenham, Swindon, Gloucestershire, Wiltshire, South Worcestershire, Herefordshire Steve Darbyshire Territory: Phone Number: North West – 07557 542 803 Greater Manchester Email address Steven.darbyshire@natwest.com Additional Towns covered: Greater Manchester, Stockport, Blackburn, Burnley, Bury, Oldham, Glossop, Sale, Altrincham, Hale, Wilmslow, Nottingham

Territory: Phone Number: London South East 07468 763 790 Email address John.bridger@natwest.con Additional Towns covered: Kent and East Sussex Maria Fraughan Territory: Northwest and Wirral

Phone Number: 07500 608 337

Email address Maria.fraughan@natwest.com Additional Towns covered: Warrington St Helens, Chester and south Cheshire Wirral Blackpool , Preston North Wales, Southport

Workout vehicles Economic recovery also created the conditions that NAMA and the other ‘bad banks’ required to reduce their loan books.

Progress has been impressive: in its last annual report, NAMA outlined that 90% of

44 | NACFB Magazine

Security may be required. Product fees may apply. Over 18s only.

National Westminster Bank Plc. Registered in England & Wales No. 929027. Registered Office: 135 Bishopsgate, London EC2M 3UR.

Industry | guides

MFS

Insider tips from the Association’s Patrons and Members

®

Specialists in fast e i le espo e ridging loans

Funding seasonal businesses Rob Straathof CEO Liberis

G

rowth is a key priority for many UK businesses. However, finding and securing the right financing may seem like a minefield in the current climate.

In fact, research from alternative finance provider Liberis has revealed that over 60% of UK SMEs said they require funding to grow, but 57% of these were unsure how to obtain it.

At Liberis, we strive to support both young companies and those with very seasonal businesses – especially when it comes to funding options, as our business cash advance allows businesses to spread their repayments over several years, always in line with their cash flow.

This has been particularly popular with businesses where income fluctuates on a seasonal basis.

Whether your clients are seasoned entrepreneurs or first-timers,

actually securing this funding may be a challenge. To help, I have put together the following four tips to support you in securing your client’s seasonal business’s investment.

Strengthen your position Before you’re ready to reach out and source funding, it’s important to be realistic about your client’s business position and existing cash flow.

Seasonal businesses are highly dynamic, so make sure your client’s business owners are revisiting and refreshing their budget regularly to make sure you’re all working from accurate figures – especially ahead of peak times of the year. Take stock of current income, expenses, overheads and ensure it’s recorded clearly in a profit and loss statement, too.

Share knowledge Ask your wider network for as much advice as possible and learn from the experience of others: which providers worked for them and which didn’t; what key questions should you be asking your suppliers; and who caters best for seasonal businesses.

Seasonal businesses are highly dynamic, so make sure your client’s business owners are revisiting and refreshing their budget regularly to make sure you’re all working from accurate figures – especially ahead of peak times of the year

46 | NACFB Magazine

Credit score When businesses seek finance, funding providers will use a credit bureau to look at their credit files and credit score. Of course, these numbers are integral indicators of how likely a business is to fulfil its financial commitments, so having a healthy credit score can be vital in securing funding.

Be well aware of factors that can affect credit scores – such as your client’s credit history – and have a clear understanding of what they can do to improve their credit score, too. For example, cancelling unused credit cards.

Closing the deal Whether sourcing a bank loan, crowdfunding or investment, it’s no secret that closing the deal can be one of the most sensitive elements of acquiring funding. Funding providers will want to understand not only the position of the business and how they plan to use the money throughout the year, but what their key challenges and current opportunities are, too. Make sure that both you and your clients have the answers.

When it comes to small business finance, there are no standard answers – but I hope these tips will help your client reach their business’s full potential.

M S is rea ing down the arrier with ro ers o ering free aluations and generous incenti es. ith a dedicated Lending Manager and a simple application process tr us and see the di erence.

SPECIAL OFFER: FREE PROPERTY VALUATIONS M S is pro iding free aluations on all residential ridging loans including u to let from to . million

Loans from to million

Rates from . per month with up to 8 L

Simple application process and no hidden costs

+44(0)20 7060 1234

www.mfsuk.com

enerous incenti es for intermediaries

info@mfsuk.com

Industry | guides

MFS

Insider tips from the Association’s Patrons and Members

®

Specialists in fast e i le espo e ridging loans

Funding seasonal businesses Rob Straathof CEO Liberis

G

rowth is a key priority for many UK businesses. However, finding and securing the right financing may seem like a minefield in the current climate.

In fact, research from alternative finance provider Liberis has revealed that over 60% of UK SMEs said they require funding to grow, but 57% of these were unsure how to obtain it.

At Liberis, we strive to support both young companies and those with very seasonal businesses – especially when it comes to funding options, as our business cash advance allows businesses to spread their repayments over several years, always in line with their cash flow.

This has been particularly popular with businesses where income fluctuates on a seasonal basis.

Whether your clients are seasoned entrepreneurs or first-timers,

actually securing this funding may be a challenge. To help, I have put together the following four tips to support you in securing your client’s seasonal business’s investment.

Strengthen your position Before you’re ready to reach out and source funding, it’s important to be realistic about your client’s business position and existing cash flow.

Seasonal businesses are highly dynamic, so make sure your client’s business owners are revisiting and refreshing their budget regularly to make sure you’re all working from accurate figures – especially ahead of peak times of the year. Take stock of current income, expenses, overheads and ensure it’s recorded clearly in a profit and loss statement, too.

Share knowledge Ask your wider network for as much advice as possible and learn from the experience of others: which providers worked for them and which didn’t; what key questions should you be asking your suppliers; and who caters best for seasonal businesses.

Seasonal businesses are highly dynamic, so make sure your client’s business owners are revisiting and refreshing their budget regularly to make sure you’re all working from accurate figures – especially ahead of peak times of the year

46 | NACFB Magazine

Credit score When businesses seek finance, funding providers will use a credit bureau to look at their credit files and credit score. Of course, these numbers are integral indicators of how likely a business is to fulfil its financial commitments, so having a healthy credit score can be vital in securing funding.

Be well aware of factors that can affect credit scores – such as your client’s credit history – and have a clear understanding of what they can do to improve their credit score, too. For example, cancelling unused credit cards.

Closing the deal Whether sourcing a bank loan, crowdfunding or investment, it’s no secret that closing the deal can be one of the most sensitive elements of acquiring funding. Funding providers will want to understand not only the position of the business and how they plan to use the money throughout the year, but what their key challenges and current opportunities are, too. Make sure that both you and your clients have the answers.

When it comes to small business finance, there are no standard answers – but I hope these tips will help your client reach their business’s full potential.

M S is rea ing down the arrier with ro ers o ering free aluations and generous incenti es. ith a dedicated Lending Manager and a simple application process tr us and see the di erence.

SPECIAL OFFER: FREE PROPERTY VALUATIONS M S is pro iding free aluations on all residential ridging loans including u to let from to . million

Loans from to million

Rates from . per month with up to 8 L

Simple application process and no hidden costs

+44(0)20 7060 1234

www.mfsuk.com

enerous incenti es for intermediaries

info@mfsuk.com

GUIDES

GUIDES

The most common errors in complex cases Complex mortgage cases are on the rise. Indeed, recent research from BDRC Continental and OneSavings Bank found that for 40% of brokers, one in four of their cases will involve limited companies, property portfolios, expats, HMOs, large loans or complex income.

48 | NACFB Magazine

Darrell Walker Head of sales InterBay Commercial

NACFB Magazine | 49

GUIDES

GUIDES

The most common errors in complex cases Complex mortgage cases are on the rise. Indeed, recent research from BDRC Continental and OneSavings Bank found that for 40% of brokers, one in four of their cases will involve limited companies, property portfolios, expats, HMOs, large loans or complex income.

48 | NACFB Magazine

Darrell Walker Head of sales InterBay Commercial

NACFB Magazine | 49

GUIDES

Underwriters will often find common mistakes when they look at complex cases and these can delay the application

M

ore complex cases can be a difficult task for brokers, with a narrower field of lenders to support them. Many mainstream lenders aren’t able to provide a bespoke case-by-case approach and won’t lend on cases that don’t fit into a more defined set of criteria. In these circumstances, a broker’s relationship with specialist lenders can be pivotal.

These lenders tend to be better placed to deal with complex requirements as most will assess cases on their individual merits and provide a bespoke solution.

Yet, even with great relationships, it can be a time-consuming and difficult process for brokers. That said, there are steps that brokers can take to ensure that they are able to best support their complex cases to enable a simple and quicker process where possible.

Underwriters will often find common mistakes when they look at complex cases and these can delay the application. Avoiding these mistakes could make a huge difference in the speed of the application going through and the client receiving their funding.

Obviously, I can’t speak on behalf of all lenders – so the brief guide below is what our underwriting team at InterBay Commercial requires to enable turnarounds on complex applications.

Missing documentation The most common factor we encounter that delays complex applications is that not all the correct documents have been supplied. When you’ve submitted an agreement in principle, you will be provided with a list of documents that we require to enable us to complete the initial underwrite.

This may include documentation that proves identity and residency, bank statements, income proof in the form of the latest three month’s payslips, accounts, SA302s or a copy of the latest contract and evidence of mortgage payments/balance outstanding on secured loans that do not show on the credit search.

Missing details Detail is essential for mortgage applications. If there is anything missing, there is a risk that the case will be rejected. Dotting the i’s and crossing the t’s before submitting an application should be part of any broker’s housekeeping procedures.

Consistency within the detail is key – for example, are the details consistent and do the numbers stack up throughout the application? Catching these errors early will help prevent unnecessary delay further down the line.

Common omissions or errors in applications include date of birth, the nationality or the national insurance number for each applicant.

Simple cross-checking, such as ensuring the applicant‘s current address and postcode is correct,

50 | NACFB Magazine

will help ensure a smoother process when conducting a credit search and therefore help limit delays.

The applicant’s other financial commitments should also be included within the application.

Surprisingly, we do receive applications that do not include the address of the property being mortgaged, or even provide the expected rental yield or a full breakdown of the purpose of the loan. These are essential for us to start reviewing the application.

Missing background Finally, the more client background a broker can provide on a complex case, the more persuasive it can be to a specialist lender. Does the applicant have experience in this sector? How many properties are involved? Is it commercial or residential (or a mix)? Is the property vacant? What makes it a compelling case?

Complex cases may seem daunting, and in part this is due to the extra detail and exceptional circumstances they entail. However, working with the right lender can make it less painful.

The main thing is for brokers to ensure that applications are accurate, consistent and contain all the details we, as lenders, require to make an informed decision. And remember: if you’ve given your lender’s BDM a compelling case, they are just as likely to support it during the internal decision-making process, acting on behalf of you and your client.

SPEED MEETS SERVICE 020 7655 3388

FAST PROPERTY FINANCE At Commercial Acceptances speed alone is not enough.

Speak straight to decision makers: a quick & personal service.

No arrangement fees, no extension fees and no end fees.

Interest charged from only 0.75% per calendar month.

Your property may be repossessed if you do not keep up on your mortgage repayments or any other debt secured on it. A rate from 0.75% will be chargeable on the amount borrowed every calendar month. However rates are subject to change and will increase or decrease in line with movements in 3m LIBOR (The London Inter-Bank Offered Rate For Three Month Sterling Deposits). Rates will be adjusted on each calendar month anniversary of the facility. The overall cost for comparison is 10.6% APR.

GUIDES

Underwriters will often find common mistakes when they look at complex cases and these can delay the application

M

ore complex cases can be a difficult task for brokers, with a narrower field of lenders to support them. Many mainstream lenders aren’t able to provide a bespoke case-by-case approach and won’t lend on cases that don’t fit into a more defined set of criteria. In these circumstances, a broker’s relationship with specialist lenders can be pivotal.

These lenders tend to be better placed to deal with complex requirements as most will assess cases on their individual merits and provide a bespoke solution.

Yet, even with great relationships, it can be a time-consuming and difficult process for brokers. That said, there are steps that brokers can take to ensure that they are able to best support their complex cases to enable a simple and quicker process where possible.

Underwriters will often find common mistakes when they look at complex cases and these can delay the application. Avoiding these mistakes could make a huge difference in the speed of the application going through and the client receiving their funding.

Obviously, I can’t speak on behalf of all lenders – so the brief guide below is what our underwriting team at InterBay Commercial requires to enable turnarounds on complex applications.

Missing documentation The most common factor we encounter that delays complex applications is that not all the correct documents have been supplied. When you’ve submitted an agreement in principle, you will be provided with a list of documents that we require to enable us to complete the initial underwrite.

This may include documentation that proves identity and residency, bank statements, income proof in the form of the latest three month’s payslips, accounts, SA302s or a copy of the latest contract and evidence of mortgage payments/balance outstanding on secured loans that do not show on the credit search.

Missing details Detail is essential for mortgage applications. If there is anything missing, there is a risk that the case will be rejected. Dotting the i’s and crossing the t’s before submitting an application should be part of any broker’s housekeeping procedures.

Consistency within the detail is key – for example, are the details consistent and do the numbers stack up throughout the application? Catching these errors early will help prevent unnecessary delay further down the line.

Common omissions or errors in applications include date of birth, the nationality or the national insurance number for each applicant.

Simple cross-checking, such as ensuring the applicant‘s current address and postcode is correct,

50 | NACFB Magazine

will help ensure a smoother process when conducting a credit search and therefore help limit delays.

The applicant’s other financial commitments should also be included within the application.

Surprisingly, we do receive applications that do not include the address of the property being mortgaged, or even provide the expected rental yield or a full breakdown of the purpose of the loan. These are essential for us to start reviewing the application.

Missing background Finally, the more client background a broker can provide on a complex case, the more persuasive it can be to a specialist lender. Does the applicant have experience in this sector? How many properties are involved? Is it commercial or residential (or a mix)? Is the property vacant? What makes it a compelling case?

Complex cases may seem daunting, and in part this is due to the extra detail and exceptional circumstances they entail. However, working with the right lender can make it less painful.

The main thing is for brokers to ensure that applications are accurate, consistent and contain all the details we, as lenders, require to make an informed decision. And remember: if you’ve given your lender’s BDM a compelling case, they are just as likely to support it during the internal decision-making process, acting on behalf of you and your client.

SPEED MEETS SERVICE 020 7655 3388

FAST PROPERTY FINANCE At Commercial Acceptances speed alone is not enough.

Speak straight to decision makers: a quick & personal service.

No arrangement fees, no extension fees and no end fees.

Interest charged from only 0.75% per calendar month.

Your property may be repossessed if you do not keep up on your mortgage repayments or any other debt secured on it. A rate from 0.75% will be chargeable on the amount borrowed every calendar month. However rates are subject to change and will increase or decrease in line with movements in 3m LIBOR (The London Inter-Bank Offered Rate For Three Month Sterling Deposits). Rates will be adjusted on each calendar month anniversary of the facility. The overall cost for comparison is 10.6% APR.

Opinion | & commentary

Jamie Stewart Director Think Business Loans

F

intech is definitely the buzz word of the day in the commercial finance sector, and it is a label seemingly attached to any and all financial technology, however loosely suited.

Because of this, there is often an air of cynicism when firms promote their services with such titles as ‘fintech platform’ or ‘fintech solution’. Even though this can dilute or confuse what fintech really is, it doesn’t take too long to scratch the surface and find some truly innovative, distinctive and effective solutions. These new and exciting ventures are really driving the development of our industry, creating and designing an intricate set of tools, from their tech start-ups in shared work spaces dotted

52 | NACFB Magazine

around the country. It’s these young, T-shirt wearing hipsters whose creative visions and approaches are shaping the future, and bringing an archaic financial model kicking and screaming into the 21st century.

The new school Without a doubt, it is the lenders that have led this charge. The ‘gold rush’ of VCs and institutions looking to jump on the fintech runaway train allowed that technology to blossom and created the pioneers and founding fathers we all know today.

However, it seems the relentless pursuit of market capture results in resources and attention being diverted elsewhere – which, in our market, has inevitably led to a slow-down in technological progression.

A subsequent second wave of lenders, aggregators and tech firms that have

tackled the frustrations of a young market are providing a much higher calibre of genuine fintech solutions that further reduce friction and ultimately enables them – and us – to lend and arrange more finance, much quicker and more effectively.

At Think, we value true next generation fintech lenders with genuine end-toend tech solutions that (in some cases) require no human input whatsoever along the customer journey – and we are pleased to see that some Patrons are already offering this service.

Open Banking Fintech comes in all shapes and sizes as we know, and there are some pioneering and effective pieces of kit, both in and entering the market. Specifically, I mean the ones

that offer solutions that are enabling much more robust decision-making capabilities for lenders – which, in turn, mitigates risk for them and ensures borrowers have access to the right types of facilities. One clear leader in this field is OpenWrks, conceived and executed by the guys at Business Finance Technology Group, which has had its foot placed firmly in the market for a number of years, being the team behind businessfinancecompared.com and Handle.

OpenWrks was the deserved recipient of the Open Up Challenge grant, which gained them funding and access to the Open Banking Standard API sandbox, and enabled them to create a tool that allows brokers and lenders to read and download their clients’ bank statements directly from their clients’ online bank account. Think

has partnered with OpenWrks to launch and pilot to great success, reducing our clients’ application time by over 70%.

OpenWrks founder Olly Betts commented: “It’s exciting to see Think leveraging Open Banking and digital journeys to create a step change in how they help small business owners get funded. Not only can they make applying for finance less of an administrative burden, but it also means lenders can make faster and more accurate and tailored lending decisions.

“This is a watershed moment for brokers in the small business finance market and one that I believe will lead to more small businesses getting the money they need to grow.”

In line with the trend, we built the ThinkApp Aggregator Platform with that vision of streamlining the funding journey in mind.

Once a client’s information has been received by the platform, our algorithms searches the whole of the market based on each client’s requirements and the information pulled from third-party data feeds – such as credit bureaus and Open Banking – produces a shortlist of lenders.

From here, brokers can submit funding requests to lenders at the click of a button, matching that to the progressive lenders on our panel that can offer live rates, instantly.

Another extremely effective tool for both lenders and brokers and one that has – through the help of our panel lenders – allowed us to drill down and match further our clients to the right lenders is DueDil.

NACFB Magazine | 53

Opinion | & commentary

Jamie Stewart Director Think Business Loans

F

intech is definitely the buzz word of the day in the commercial finance sector, and it is a label seemingly attached to any and all financial technology, however loosely suited.

Because of this, there is often an air of cynicism when firms promote their services with such titles as ‘fintech platform’ or ‘fintech solution’. Even though this can dilute or confuse what fintech really is, it doesn’t take too long to scratch the surface and find some truly innovative, distinctive and effective solutions. These new and exciting ventures are really driving the development of our industry, creating and designing an intricate set of tools, from their tech start-ups in shared work spaces dotted

52 | NACFB Magazine

around the country. It’s these young, T-shirt wearing hipsters whose creative visions and approaches are shaping the future, and bringing an archaic financial model kicking and screaming into the 21st century.

The new school Without a doubt, it is the lenders that have led this charge. The ‘gold rush’ of VCs and institutions looking to jump on the fintech runaway train allowed that technology to blossom and created the pioneers and founding fathers we all know today.

However, it seems the relentless pursuit of market capture results in resources and attention being diverted elsewhere – which, in our market, has inevitably led to a slow-down in technological progression.

A subsequent second wave of lenders, aggregators and tech firms that have

tackled the frustrations of a young market are providing a much higher calibre of genuine fintech solutions that further reduce friction and ultimately enables them – and us – to lend and arrange more finance, much quicker and more effectively.

At Think, we value true next generation fintech lenders with genuine end-toend tech solutions that (in some cases) require no human input whatsoever along the customer journey – and we are pleased to see that some Patrons are already offering this service.

Open Banking Fintech comes in all shapes and sizes as we know, and there are some pioneering and effective pieces of kit, both in and entering the market. Specifically, I mean the ones

that offer solutions that are enabling much more robust decision-making capabilities for lenders – which, in turn, mitigates risk for them and ensures borrowers have access to the right types of facilities. One clear leader in this field is OpenWrks, conceived and executed by the guys at Business Finance Technology Group, which has had its foot placed firmly in the market for a number of years, being the team behind businessfinancecompared.com and Handle.

OpenWrks was the deserved recipient of the Open Up Challenge grant, which gained them funding and access to the Open Banking Standard API sandbox, and enabled them to create a tool that allows brokers and lenders to read and download their clients’ bank statements directly from their clients’ online bank account. Think

has partnered with OpenWrks to launch and pilot to great success, reducing our clients’ application time by over 70%.

OpenWrks founder Olly Betts commented: “It’s exciting to see Think leveraging Open Banking and digital journeys to create a step change in how they help small business owners get funded. Not only can they make applying for finance less of an administrative burden, but it also means lenders can make faster and more accurate and tailored lending decisions.

“This is a watershed moment for brokers in the small business finance market and one that I believe will lead to more small businesses getting the money they need to grow.”

In line with the trend, we built the ThinkApp Aggregator Platform with that vision of streamlining the funding journey in mind.

Once a client’s information has been received by the platform, our algorithms searches the whole of the market based on each client’s requirements and the information pulled from third-party data feeds – such as credit bureaus and Open Banking – produces a shortlist of lenders.

From here, brokers can submit funding requests to lenders at the click of a button, matching that to the progressive lenders on our panel that can offer live rates, instantly.

Another extremely effective tool for both lenders and brokers and one that has – through the help of our panel lenders – allowed us to drill down and match further our clients to the right lenders is DueDil.

NACFB Magazine | 53

OPINION & COMMENTARY

The ultimate aim is simple, end-to-end, live decisioning, pricing and drawdown

DueDil is a company information platform that pulls together data from thousands of sources, including company websites, financial filings, news reports, registry data, trademarks and court judgements.

This information then becomes searchable by company and presented on an easyto-use dashboard. This helps us and our lenders to avoid risks by identifying the right companies to lend to – and how much to lend. This tool – working alongside the OpenWrks Open Banking data – really optimises the process of filtering through hundreds of lenders, and ensures our own ThinkApp software can genuinely match within the closest parameters possible.

The utopia The ultimate aim is simple, end-to-end, live decisioning, pricing and drawdown – and I feel, for the first time since the initial gold rush, that we are truly getting there. This promised land could have an immeasurable effect on the productiveness of the industry, the broker market and the overall economy, and create a sector that has finally caught up with financial technology.

In a world of instant money transactions – be it through online or mobile banking or services such as PayPal, TransferWise or Revolut – it’s about time debt and borrowing dusted off the cobwebs.

54 | NACFB Magazine

OPINION & COMMENTARY

The ultimate aim is simple, end-to-end, live decisioning, pricing and drawdown

DueDil is a company information platform that pulls together data from thousands of sources, including company websites, financial filings, news reports, registry data, trademarks and court judgements.

This information then becomes searchable by company and presented on an easyto-use dashboard. This helps us and our lenders to avoid risks by identifying the right companies to lend to – and how much to lend. This tool – working alongside the OpenWrks Open Banking data – really optimises the process of filtering through hundreds of lenders, and ensures our own ThinkApp software can genuinely match within the closest parameters possible.

The utopia The ultimate aim is simple, end-to-end, live decisioning, pricing and drawdown – and I feel, for the first time since the initial gold rush, that we are truly getting there. This promised land could have an immeasurable effect on the productiveness of the industry, the broker market and the overall economy, and create a sector that has finally caught up with financial technology.

In a world of instant money transactions – be it through online or mobile banking or services such as PayPal, TransferWise or Revolut – it’s about time debt and borrowing dusted off the cobwebs.

54 | NACFB Magazine

OPINION & COMMENTARY

LOWEST RATES &

Planning constraints vs SMEs Neal Moy Head of property finance RateSetter

I

f the supply of housing in the UK was linked to the volume of press coverage on the housing market, there would be no problem in meeting the government’s ambition of building one million new houses between 2015 and 2020.

The reality is that the supply of housing has, for many decades, been severely restricted by planning constraints and the general lack of local authority approvals for property developers. According to the Ministry of Housing, Communities and Local Government, new-build completions in England have averaged around 140,000.

However, numerous housing market analysts have suggested that we need to build as many as 250,000 more houses every year – a level not seen since the 1970s.

Nevertheless, planners remain reluctant to support major planning applications largely due to fears of upsetting local residents who may object to new schemes, often citing pressure on infrastructure (for example, roads and sewerage) and services (schools and healthcare).

Half of new builds are built by the seven largest property companies, but given the obstacles facing major housing developments, which are constraining completions, can smaller property builders make a material impact on housing numbers?

56 | NACFB Magazine

The last decade has seen a contraction in the number of small businesses building properties, but according to research conducted by the Home Builders Federation in 2017, raising the number of SME housebuilders to 2007 levels could increase the supply of new housing by up to 25,000 homes a year. However, following the financial crisis, one of the key obstacles that smaller property developers often encounter is accessing appropriate finance to support their projects.

This is a sector that RateSetter knows very well. Our investors have lent over £250m to experienced small property developers across England and Wales over the last four years, and we are enthusiastic about supporting the sector to increase its output.

We provide highly flexible finance for property development from £500,000 up to £10m, lending up to 65% loan-togross development value or 80% loan to costs, whichever is the lower, over a period of one to two years. We also offer development exit finance of up to 70% LTV of the completed development over a one-year period. While the national undersupply of housing provides a great strategic opportunity for RateSetter and property developers working together, the supply-demand imbalance also provides an extra layer of comfort in terms of managing risk for our investors, in addition to the LTV ratios that we require.

We look for development schemes that have either an existing, detailed planning permission, or have an application for

planning permission in progress (in which case we can provide finance, conditional upon planning permission being granted).

As many people will know from their own personal experience, there are no guarantees that planning permissions are granted, so in the latter case, we are effectively speculating our own time and resources. However, we are prepared to do this to assist developers in securing suitable property development sites in the first place. Small property developers do not have vast resources and can ill afford costly planning fees and delays to applications – so our objectives are aligned in this.

Our philosophy is to keep things simple and our focus is on cultivating enduring relationships with developers so that we can work together on subsequent development schemes in years to come.

The property developers we work with tell us that they really like our straightforward and speedy approach, which means that we can provide approval to a finance facility within a week of receiving their information, including a visit to the site to be funded.

With the persistently large mismatch between supply of new housing and demand for it, we are committed to actively working with enterprising small property businesses to give them the financial power to deliver the properties that people need.

2% 22%%COMMISSION

AVAILABLE TO ALL ALL BROKERS

OPINION & COMMENTARY

LOWEST RATES &

Planning constraints vs SMEs Neal Moy Head of property finance RateSetter

I

f the supply of housing in the UK was linked to the volume of press coverage on the housing market, there would be no problem in meeting the government’s ambition of building one million new houses between 2015 and 2020.

The reality is that the supply of housing has, for many decades, been severely restricted by planning constraints and the general lack of local authority approvals for property developers. According to the Ministry of Housing, Communities and Local Government, new-build completions in England have averaged around 140,000.

However, numerous housing market analysts have suggested that we need to build as many as 250,000 more houses every year – a level not seen since the 1970s.

Nevertheless, planners remain reluctant to support major planning applications largely due to fears of upsetting local residents who may object to new schemes, often citing pressure on infrastructure (for example, roads and sewerage) and services (schools and healthcare).

Half of new builds are built by the seven largest property companies, but given the obstacles facing major housing developments, which are constraining completions, can smaller property builders make a material impact on housing numbers?

56 | NACFB Magazine

The last decade has seen a contraction in the number of small businesses building properties, but according to research conducted by the Home Builders Federation in 2017, raising the number of SME housebuilders to 2007 levels could increase the supply of new housing by up to 25,000 homes a year. However, following the financial crisis, one of the key obstacles that smaller property developers often encounter is accessing appropriate finance to support their projects.

This is a sector that RateSetter knows very well. Our investors have lent over £250m to experienced small property developers across England and Wales over the last four years, and we are enthusiastic about supporting the sector to increase its output.

We provide highly flexible finance for property development from £500,000 up to £10m, lending up to 65% loan-togross development value or 80% loan to costs, whichever is the lower, over a period of one to two years. We also offer development exit finance of up to 70% LTV of the completed development over a one-year period. While the national undersupply of housing provides a great strategic opportunity for RateSetter and property developers working together, the supply-demand imbalance also provides an extra layer of comfort in terms of managing risk for our investors, in addition to the LTV ratios that we require.

We look for development schemes that have either an existing, detailed planning permission, or have an application for

planning permission in progress (in which case we can provide finance, conditional upon planning permission being granted).

As many people will know from their own personal experience, there are no guarantees that planning permissions are granted, so in the latter case, we are effectively speculating our own time and resources. However, we are prepared to do this to assist developers in securing suitable property development sites in the first place. Small property developers do not have vast resources and can ill afford costly planning fees and delays to applications – so our objectives are aligned in this.

Our philosophy is to keep things simple and our focus is on cultivating enduring relationships with developers so that we can work together on subsequent development schemes in years to come.

The property developers we work with tell us that they really like our straightforward and speedy approach, which means that we can provide approval to a finance facility within a week of receiving their information, including a visit to the site to be funded.

With the persistently large mismatch between supply of new housing and demand for it, we are committed to actively working with enterprising small property businesses to give them the financial power to deliver the properties that people need.

2% 22%%COMMISSION

AVAILABLE TO ALL ALL BROKERS

OPINION & COMMENTARY

SPECIALIST LENDING SOLUTIONS BRIDGING FINANCE

intelligence I

t’s become a cliché to say that artificial intelligence (AI) is changing the way businesses work. But having left banking last year to work for Growth Street – a fintech start-up – I’m always keen to work out what tech trends are likely to impact SME customers in the future. That’s why I recently attended the HfS FORA (Future of Operations in the Robotic Age) summit at Cambridge University.

HfS Research operates the FORA Council, which hosts summits a few times a year. This time, we were in the beautiful surroundings of Gonville and Caius College, where Stephen Hawking served as a fellow for many years. I can’t think of a better place to discuss cutting-edge technology.

Although I’m always interested in innovation, I confess to having been a little sceptical as to how important technologies such as AI and machine learning could be for SMEs. And with many multinational tech, finance and consulting giants present at the event, I could have been forgiven for thinking that the tech on show was just for the big players.

However, my impression soon changed thanks to enlightening talks, insightful demos and fascinating conversations.

Lots of discussions centred on how useful AI and automation can be for impacting the customer experience. It was refreshing that the conversation didn’t focus on how many jobs would be lost thanks to these new technologies, but instead on how they could make existing roles more efficient.

This could improve the time insurance businesses take to make underwriting decisions, or automatically complete menial tasks that are being carried out by highly qualified engineers or scientists. I could immediately see how a few of Growth Street’s customers might benefit from these new, faster ways of getting things done.

58 | NACFB Magazine

One of the key lessons I learned was that these technologies aren’t a pipe dream: they’re ready for businesses to use, right now. An excellent example was a small financial services business that invested in a relatively inexpensive chatbot, which today delivers an automated customer service process for 80% of interactions.

This has resulted in improved customer feedback and online reviews.

These fantastic stories raise an interesting question, though: what’s stopping more businesses from incorporating AI and other innovation into their day-to-day operations? Personally, I think SMEs could benefit from cultivating a mindset that’s geared around being open to new ideas.

In my opinion, every UK SME, regardless of size, needs a vision for their digital future – a roadmap which includes the adoption of new technologies that could transform processes and create new efficiencies.

As I’ve seen, these improvements don’t necessarily mean replacing humans in the workforce: many of these innovations enable people to do their existing jobs with fewer monotonous tasks and more room to focus on high-value work. So, does all this apply to finance brokers too? The answer is, absolutely. As well as advising businesses on how they can adopt new technologies, brokers and other introducers could also be thinking about how to get smarter and slicker in how they do business.

What I took away from the HfS FORA Summit was a real sense that many of these next-generation technologies are focused on impacting the customer experience. That’s a great start, but at the same time businesses need to focus on the future as well as the here and now.

In many ways, SMEs are the ideal places to test these innovations: after all, the decision-making process is often leaner than in big, complicated companies.

Do you think your firm’s culture is open to trying new technologies? AI and machinelearning applications that work for you might be right around the corner.

Our lowest Bridging Finance range from only 0.49%pm Available for standard and light refurbishment Automated valuations and Joint Legal Representation for faster completions Dedicated underwriter from DIP to completion Available through all distribution channels

Contact your local BDM 0800 116 4385 precisemortgages.co.uk

FOR INTERMEDIARY USE ONLY.

Precise Mortgages is a trading name of Charter Court Financial Services Limited which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (Financial Services Register Firm Reference Number 494549). Registered in England and Wales (company number 06749498).

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

01848 (3)

Faye McDonough Head of relationship management Growth Street

Get in touch

Lessons in artificial

OPINION & COMMENTARY

SPECIALIST LENDING SOLUTIONS BRIDGING FINANCE

intelligence I

t’s become a cliché to say that artificial intelligence (AI) is changing the way businesses work. But having left banking last year to work for Growth Street – a fintech start-up – I’m always keen to work out what tech trends are likely to impact SME customers in the future. That’s why I recently attended the HfS FORA (Future of Operations in the Robotic Age) summit at Cambridge University.

HfS Research operates the FORA Council, which hosts summits a few times a year. This time, we were in the beautiful surroundings of Gonville and Caius College, where Stephen Hawking served as a fellow for many years. I can’t think of a better place to discuss cutting-edge technology.

Although I’m always interested in innovation, I confess to having been a little sceptical as to how important technologies such as AI and machine learning could be for SMEs. And with many multinational tech, finance and consulting giants present at the event, I could have been forgiven for thinking that the tech on show was just for the big players.

However, my impression soon changed thanks to enlightening talks, insightful demos and fascinating conversations.

Lots of discussions centred on how useful AI and automation can be for impacting the customer experience. It was refreshing that the conversation didn’t focus on how many jobs would be lost thanks to these new technologies, but instead on how they could make existing roles more efficient.

This could improve the time insurance businesses take to make underwriting decisions, or automatically complete menial tasks that are being carried out by highly qualified engineers or scientists. I could immediately see how a few of Growth Street’s customers might benefit from these new, faster ways of getting things done.

58 | NACFB Magazine

One of the key lessons I learned was that these technologies aren’t a pipe dream: they’re ready for businesses to use, right now. An excellent example was a small financial services business that invested in a relatively inexpensive chatbot, which today delivers an automated customer service process for 80% of interactions.

This has resulted in improved customer feedback and online reviews.

These fantastic stories raise an interesting question, though: what’s stopping more businesses from incorporating AI and other innovation into their day-to-day operations? Personally, I think SMEs could benefit from cultivating a mindset that’s geared around being open to new ideas.

In my opinion, every UK SME, regardless of size, needs a vision for their digital future – a roadmap which includes the adoption of new technologies that could transform processes and create new efficiencies.

As I’ve seen, these improvements don’t necessarily mean replacing humans in the workforce: many of these innovations enable people to do their existing jobs with fewer monotonous tasks and more room to focus on high-value work. So, does all this apply to finance brokers too? The answer is, absolutely. As well as advising businesses on how they can adopt new technologies, brokers and other introducers could also be thinking about how to get smarter and slicker in how they do business.

What I took away from the HfS FORA Summit was a real sense that many of these next-generation technologies are focused on impacting the customer experience. That’s a great start, but at the same time businesses need to focus on the future as well as the here and now.

In many ways, SMEs are the ideal places to test these innovations: after all, the decision-making process is often leaner than in big, complicated companies.

Do you think your firm’s culture is open to trying new technologies? AI and machinelearning applications that work for you might be right around the corner.

Our lowest Bridging Finance range from only 0.49%pm Available for standard and light refurbishment Automated valuations and Joint Legal Representation for faster completions Dedicated underwriter from DIP to completion Available through all distribution channels

Contact your local BDM 0800 116 4385 precisemortgages.co.uk

FOR INTERMEDIARY USE ONLY.

Precise Mortgages is a trading name of Charter Court Financial Services Limited which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (Financial Services Register Firm Reference Number 494549). Registered in England and Wales (company number 06749498).

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

01848 (3)

Faye McDonough Head of relationship management Growth Street

Get in touch

Lessons in artificial

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