Thursday, Feb 21, 2008
Alliance & Leicester effectively pulling out of the mortgage market
Mortgagesolutions: A&L to scale back mortgage offering
Alliance & Leicester (A&L) is retreating from the mortgage market after revealing it had suffered £185m losses in the wake of the credit crunch, knocking 30% off last year’s profits. Following the news of the losses, shares slumped to a record low of 428p yesterday and were 472p at the time of going to press. The problems have forced the bank to cut back its lending, with Chris Rhodes, acting finance director, revealing A&L would concentrate on keeping its existing customers during the coming year rather than seek out new borrowers by offering market-leading mortgage rates. In yesterday’s trading statement, Rhodes commented: “We expect net new mortgage lending to be negative this year. We expect to concentrate on customer retention."
Posted by jack c @ 01:34 PM (923 views) Add Comment
14 Comments
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1. hpwatcher said...
Along with NR, that is effectively 2 in as meany days.
2. Matt_the_hat said...
Sounds like the same stratergy as NR used wonder if they use the same letters to existing customers and just change the letter head.
3. jack c said...
Interesting because it further limits the publics options on either new purchases or re-mortgages - the absence of willing/able lenders will (IMO) definitely put further downward pressure on house prices.
2 down how many more to go?
4. tyrellcorporation said...
Expect a landslide IMHO.
5. wiltshire said...
The MPC are going to have to take off at least one percent next month if they hope to spark this HP corpse into life.
6. hpwatcher said...
''The MPC are going to have to take off at least one percent next month if they hope to spark this HP corpse into life''
the inflation would be horiffic....
the only viable option is to hold firm, but they probably won't............
7. Landofconfusion said...
> 2. jack c said...
Agreed. Those that are left will probably raise rates to take advantage of the lack of competition. With all those people coming off low rate capped / fixed mortgages, things could get very interesting indeed.
8. jack c said...
No wonder the Gov't want legislation in place so that the BOE can provide covert assistance to faltering banks.
The NR emergency legislation is also under threat see news.bbc.co.uk/1/hi/uk_politics/7255834.stm
Gordon's miracle economy and 10 year stewardship as chancellor is unravelling this very week
9. wiltshire said...
hpwatcher, I agree, I think cuts are the only tool they think they have. I'm terrified at the thought of how the MPC/Labour are going to try and land this baby. I haven't noticied many VI comments about 'soft landings' in the past week or so (apart from Stuart Law - 'The ass in Assetz'). They've probably realised we're past the point of soft landings and are busy trying to find bunkers to hide in for the next decade.
10. Moley20 said...
To hpwatcher & Jack
Lenders currently retreating
NR, AL,
Advatange - closed down
SPML, Prefferred - made redundancies
Platform - redundancies
Coventry, abbey, BM - all taking 125 LTV products off shelf.
Favourite BTL lender - Paragon not doing much - I suspect they go belly up next month.
There will be lot more. just hang in their.
I have been looking to buy since 2006 and have had an eye on one particular road.
I noticed a property that was sold in may 2006 for 335k back on the market for 550K
The EA has over valued to get sole agency.
11. cornishman said...
Anyone noticed how tired GB looks lately? Trying to run the economy singlehandedly can't be easy.
A heart attack might be his way out I suppose. Overweight Scot/bad diet and all that...
12. mark wadsworth said...
W, as long as you can find a bunker to rent, rather than buy!
13. Chris B said...
Excellent ! ! ! however, the parasites should never have been aloud to offer that percentage . I now assume the targets in the
mortgage departments have been scaled back and looks like the incentives to some far flung sun drenched country now means skeggie
Lincs ! .
14. wiltshire said...
Buy-to-let bunkers, now there's a commodity worth getting a 125% interest only mortgage on!
Joking aside I would love to really know what is going through the minds of EAs at the moment. They must know they are staring down the barrel of a gun and obviously whilst their faces are brave their trousers probably tell a different story. Are there no blogs where any of them tell the story from inside the eye of the storm?