According to O’Brien with the majority of lenders having set themselves higher lending targets than last year and with a less buoyant housing market, existing lenders and any potential new entrants would value having access to the distribution channels offered by a large packager or packager organisation.
He likened the process to the period when lenders bought up vast swathes of the estate agency business. “Business levels have been at their lowest for the last twenty years over the last two or three months,” he said. “What happens if this continues?”
He added that the only way out for some lenders might be to buy market share. Julian Wells, head of marketing at Merryl Lynch-owned lender Mortgages plc, commented: “I suppose it is possible, after all we bought Genesis and other lenders have made similar moves. “Though this is the first I have heard of the acquisition of packager collectives.”
However Matthew Bright, managing director of Surrey-based packager and distributor Optoma, was sceptical. He said: “It would be a nice scenario but if a packager were owned by one lender they could lose their exclusives with other lenders which could in turn lead to fewer brokers using them. “There is no guarantee that a packager would be able to maintain distribution levels.”
