Bridging lenders positive about 2020 prospects

 The latest sentiment survey from the Association of Short Term Lenders (ASTL) shows that bridging lenders have grown in confidence about the outlook for the UK economy, their own business and the bridging sector. 

The research, which was conducted amongst members of the ASTL shortly after the date was confirmed for the upcoming General Election, found that more than 75% of bridging lenders are confident about the long-term prospects for the UK economy, compared to just 50% when the survey was last run in June. 

Lenders have also grown in confidence about the prospects for their own business. Nearly three-quarters (72%) said they expect their business to grow over the next six months, which is up from 59% in the last survey. 

This positive outlook is reflected in the expectations of respondents for the turnover of the bridging sector. Just over half of lenders (52%) said that they expect the market to grow in the next six months, compared to less than a quarter (23%) who anticipated growth in June. 

Throughout this period, lenders also expect modest growth in competition from other lenders and competition is no longer seen as the biggest challenge for bridging lenders. It has been replaced by the slow-moving property market, which was identified as the main hurdle by 55% of respondents. 

Another interesting trend from the survey is that, while in January 2019 75% of respondents said that they would vote to remain in the European Union if there were a second referendum, most lenders would now choose to leave with Boris Johnson’s deal. 

Benson Hersch, CEO at the ASTL, says: “Overall, our members are very positive about prospects for the UK, their own businesses and the bridging sector as a whole. Competition is expected to increase slightly in the next six months, but this seems to hold little concern for our members, and the downward slope in positivity has been reversed. It is hoped that the general feeling of positivity will turn out to be realistic and we look forward to a great end to 2019 and an even better year ahead in 2020.”

Press Release, Wednesday, 13 November 2019

The ASTL Positivity Index

 

ASTL announces new Board of Directors

The Association of Short Term Lenders (ASTL) has announced a new Board of Directors following a voting process amongst members to elect the new Executive Committee.

The new Board is effective from 1 September 2019 and includes five lender member representatives and one associate member representative, plus the CEO. The elected Directors will serve as Executive Committee members of the ASTL, acting as a guiding influence to provide direction and decision-making for the Association.

The elected Executive Committee comprises of Allan Kay (Alternative Bridging Corporation), Steven Barber (Bridging Finance Solutions), James Bloom (Masthaven), Gavin Diamond (United Trust Bank). Sarah Jackson (Pivot) and Jonathan Newman (Brightstone Law) complete the Board having previously been elected to serve two terms.

Benson Hersch, CEO of the ASTL, says: “The Executive Committee of the ASTL plays an incredibly important role in helping to shape the future of the bridging industry. This is the Board who will provide a consistent presence as we enter an exciting period of change under a new CEO and I welcome all of the new directors who I look forward to working with during my remaining time in the role.

The election was very close, and we would like to express our thanks to all members nominated who stood for election, and of course we thank ASTL’s lender members who voted.”

Press Release: Wednesday, 4^th September, 2019

Facing the Challenges Ahead. Solid foundations from which to move forward

It seems that the ongoing saga of Brexit is doing little to dampen the growth of the bridging sector. In the most recent lending figures compiled by auditors from data provided by members of the ASTL, it was confirmed that bridging loan books grew to a record £4.62bn at the end of the second quarter of this year, representing growth of 11.7% compared to Q1 2019 and an increase of 14.4% on the same quarter last year.

Bridging loan applications also hit a record high in the 12 months preceding the end of Q2 2019, with £22.13bn of applications representing a 9.7% increase on the same period the previous year.

These are strong results, particularly given the uncertain politic and economic environment, but it is very important that we do not get carried away. Record lending is all very well, but if it comes accompanied by the ignominious collapse of lenders, as we saw with Lendy earlier this year, then reputation of the industry will be damaged and the sustainability of lending such volumes should be questioned. The challenge for the industry now is to continue this level of activity whilst maintaining high standards of underwriting and customer focus.

This is particularly important as it looks like the writing is on the wall with regards to regulation of the short-term commercial lending sector. At the end of July, the House of Commons Treasury Committee urged HM Treasury to extend the remit and powers of the FCA to unregulated SME lending, amongst other areas.

The concern is than when regulation does come, it will be targeted at the lowest common denominator to those organisations that exhibit the most questionable practices. This means that it won’t be light touch and it will impact the whole market. This may protect some customers, but it will also be to the detriment of many more and stifle innovation in this vibrant sector.

There is, however, good news. We have a window of opportunity to influence the shape of regulation and demonstrate that we are collectively a responsible industry that operates with the best intentions of our customers at our heart. And we are doing this from solid foundations in a growing market.

Lenders may feel competitive pressures, given the over-supply of funding, but there is still a good level of demand and the market is in a healthy state. We must use this as a foundation to build the next chapter of development and this is why it is so important that we agree across the board to a code of conduct that protects our investors, our borrowers and our sector.

My, admittedly biased, opinion is that there has never been more need for an organisation like the ASTL to take the lead and ensure the industry follows a code of conduct that ensures customers get the best deal, are not misled, and can encourage the FCA to take a pragmatic approach to regulation.

We have many challenges ahead of us, but at least we are facing them from a strong foundation.

Benson Hersch, CEO of the ASTL
A version of this article appeared in the September edition of Bridging Introducer

 

 

Whitehall Capital joins The Association of Short Term Lenders

Whitehall Capital has become the latest lender to join the Association of Short Term Lenders (ASTL).

Whitehall Capital is a specialist bridging, short-term finance, auction finance and development finance provider with more than a decade in the market.

As part of its membership of the ASTL, the lender has signed up to a code of conduct, which includes treating customers fairly and requires that all fees are proportionate and openly disclosed.

Anthony Bodenstein, Founder & Managing Partner at Whitehall Capital, says: “Whitehall Capital is extremely pleased to step under the ASTL’s umbrella and join a number of other reputable lenders who uphold the high standards of the association. This is a vote of confidence in what we have achieved thus far and will no doubt help us further strengthen our market offering.”

Benson Hersch, CEO of the ASTL, says: “We are delighted to welcome Whitehall Capital as the latest lender to join the ASTL. As with all of our members, Whitehall Capital has demonstrated a customer focus and commitment to high standards that will help to advance the reputation of the industry.”

Press Release: Wednesday, 21^st August 2019