Mortgage Charter ’breathing space’ gives lenders a headache
No one working in our industry will have missed the much publicised ‘Mortgage Charter’ agreed by members of UK Finance with the Government. Many of the provisions are not new and most lenders already comply with most of the clauses, but there are significant differences now. First, many of the agreed provisions were not previously […]
ESG –the need for independent due diligence until regulation catches up!
Earlier this month our Group Chief Executive and Founder, Brian Pitt, led a panel debate discussing transparency and greenwashing in ESG at the Global ABS conference in Barcelona. The debate was enhanced by the quality of the panel, which benefitted from the insight of European regulators. While transparency within ESG is improving, it was […]
Challenger banks and financial crime controls
The FCA has recently announced the results of its review of challenger banks anti-fraud processes and controls. It undertook an extensive research programme that included over 50% of relevant firms and a sample that covered 8 million customers. The review focused on the activities of digital banks, a subset of challenger banks, who use technology led onboarding processes to promote quick and easy application procedures.
Buy now pay later products and RMBS concerns
The change in approach and increased level of anxiety regarding BNPL schemes is increasing. So why are RMBS investors becoming progressively more concerned?
1) The HM Treasury consultation on the regulation of BNPL schemes highlighted interesting growth statistics: the value of transactions from the main providers had more than tripled, 11% of consumers had used BNPL since the start of the COVID-19 pandemic (around 5 million individuals) and that an FCA review had identified the size of the market in 2020 at £2.7bn and growing rapidly, possibly doubling in 2021 alone.
ESG mortgages, FCA ups the stakes!
In our last blog we focused on the fact that RMBS investors are genuinely becoming more ESG focused. This is partly because of the premium that underpins a green transaction (the ‘greenium’), but also because regulators are starting to drive green issues. The latter was brought back into focus in a recent FCA ‘Dear CEO’ letter to Retail Mortgage Lenders.
The FCA has helpfully refreshed its ESG strategy, setting out its target outcomes and the actions that it will take in 2022. The tightening of FCA requirements will not only affect the manufacturers of mortgages, but the enhanced requirements will also influence future investors and investment strategies. Where ESG is concerned lenders and investors can no longer sit on the fence.