ShareLink reveals ambition to tackle mortgage market: Dealing firm warns of threat from declining equity volumes

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The Independent Online
Southern Electric the telephone- based share-dealing company, wants to start offering mortgages within 18 months, but says the initiative hinges on increasingly competitive market conditions.

David Jones, chief executive, who brought ShareLink to the market last July, said he would like to do for the mortgage market what the company had already done for share-dealing.

Mr Jones admitted that banks and building societies were throwing more capital at the mortgage business, but said this applied to all financial services. 'If it doesn't look as attractive at the time, then we won't go into the market,' he said.

ShareLink's pre-tax profits doubled to pounds 6.2m, including a one-off profit of pounds 1.2m on the BT3 privatisation. Turnover rose by 44 per cent to pounds 20.6m, or including BT3, by 62 per cent to pounds 23.3m.

Mr Jones warned: 'Trading volumes in the UK equity market have been subdued since mid- February. If these conditions were to persist throughout the current year, ShareLink's earnings would suffer.'

He said private investors across the UK, not just with ShareLink, were waiting for volatility in the market to subside and for a trend to appear. 'But we're still getting 1,000 new customers a week,' he added.

A first-time final dividend of 6p is being paid making 9p for the year. Earnings per share more than doubled to 26.11p.

PEP funds under administration rose by 146 per cent to pounds 165m, with 40,000 plans now under ShareLink control. Cash subscriptions for PEPs increased almost fourfold to pounds 94m.

Subscriptions to ShareLink's information service increased by almost 200 per cent to 17,000. The value of cash and stock held within ShareLink's traded options service also rose by nearly 100 per cent to pounds 6m.

The company, which prides itself on having no borrowings, ended the year to 31 March with net cash of pounds 8m.

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