IF takes 9% of new UK mortgages

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The Independent Online

Intelligent Finance, the internet and telephone bank owned by HBoS, has taken 9 per cent of the UK new mortgage market in its first year of business despite obtaining fewer than half the number of customers it originally targeted.

Intelligent Finance, the internet and telephone bank owned by HBoS, has taken 9 per cent of the UK new mortgage market in its first year of business despite obtaining fewer than half the number of customers it originally targeted.

IF offers mortgages that can be paid off faster through overnight "sweeping" of surplus funds in a customer's current account. The company said it had comfortably hit its customer balance targets and remained confident of reaching break-even by the second half of 2003. It has £8.9bn in balances and is among the country's top-five mortgage providers.

In June, IF had 7 per cent of the market for new home loans.

Jim Spowart, the chief executive, said high average customer balances had helped offset lower-than-expected customer gains of 242,000 against a projected 500,000. "You can't judge performance on the basis of customer numbers. Internet banks will be judged not on customer numbers but on customer balances," he said.

There was no sign of deterioration in demand for mortgages despite signs of a slowdown in the rate of house price inflation, although the proportion of business attributable to remortgaging had risen from 40 per cent to one-half since the summer.

Shares in HBoS closed down 17.5p at 807.5p.

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