Legal & General is winding down its appointed representative network with all member firms being encouraged either to have joined another network or become directly authorised by the end of the year.
Stephen Smith, director, mortgage club and housing at L&G, said allegations that the group was closing its AR network were incorrect but confirmed he was in talks with its AR firms about “how to evolve” the relationship.
He said: “We are moving away from ARs rather than closing down our network. It isn’t closing, it is evolving and our relationships with our business partners are evolving.
“We have as firm a commitment to the UK mortgage market as we always have. The mortgage club is growing this year, it grew last year and it will continue to grow.”
It is understood that L&G network ARs are quietly being urged to join Stonebridge, an AR network that operates through the L&G mortgage club, and that referrals are also being made to Mortgage Advice Bureau, another network with L&G’s mortgage club.
Today Crystal Clear Financial Planning, a former L&G AR, revealed it had joined Stonebridge after four years at L&G’s AR network.
Darren Burdis, director at Crystal Clear Financial Planning, said: “The decision to move to Stonebridge was really put on us by L&G as they are closing the AR network – it’s definite. There won’t be any ARs next year.
“They offered us a choice of going DA or joining one of their preferred partners – either Stonebridge or MAB. We didn’t do enough volume to go DA but we are very happy with our move to Stonebridge.”
In January this year The Mortgage Advice Shop left L&G’s network after 24 years to join L&G mortgage club member network Stonebridge as an AR.
Helen Martin, managing director at Belfast-based The Mortgage Advice Shop, said: “I knew I would eventually have to leave the L&G network as I had a feeling they were going down the directly authorised line.
“They didn’t encourage me to leave but when I had the opportunity to go to Stonebridge, L&G said to me the opportunity was there and if I wanted to take it they wouldn’t hold me back.”
The latest figures from Which Network showed Stonebridge gained more ARs than any other network in the first quarter of the year with 25 firms joining the group.
In 2014 the network recruited 51 AR firms, up 22% on the previous year. MAB meanwhile gained four ARs while L&G registered a loss of one.
Overall Which Network numbers showed ARs numbers across the industry fell a fifth with just 5,600 registered ARs this year compared to 6,981 last year.
In April this year Sesame Bankhall confirmed that all investment and pension ARs would have either to become directly authorised or leave the network, with Intrinsic confirmed as its preferred partner.
