Interview with Roger Dewsbery

Roger Dewsbery in his last interview of year concentrating on his final thoughts of 2009 and his upcoming predications for what may come in 2010.

Briefly, Roger is a well established and experienced figure in the UK financial services; this is due to his 40 years worth of experience alone. He still happily works for Crystal Mortgages Ltd, leading their underwriting team as senior underwriter. Roger has faced many a scenario in relation to financial services & what may be thrown at you whether that is for good or bad! So enough of me boring you, lets hear from the man himself…

…Now, 2009 was tough year throughout all industries, but How has it affected the financial services in general?

Annus Horribilis is a fair assessment. We kind of saw it coming at the end of 2007 when loan securitisations started to run aground which triggered numerous Lenders progressively withdrawing from lending during 2008. That was bad enough but the collapse of Lehman Brothers in September 2008 signalled the end of the world as we knew it so there was not much hope for 2009 before it even started.
In the first half of 2009 survival was the main issue. The only way forward being to consolidate resources and assess what was needed in the market place ; the big question being “Can it be funded” even when we know what is wanted.
It was a difficult project ; possibly the most difficult in my time in the Industry. At least 40% of Brokers (an important supply of business) had collapsed and the borrowing client was running scared so we at Crystal Mortgages Ltd. needed to identify and provide something pretty good.
Our “Near Prime” exclusive in house funded product was launched in April of 2009, having completed successful funding arrangements with our Financial Partners, thus enabling us to provide a lending package to businesses in near prime situations where the Bank clearly was not going to help.
Our funding product, starting at below 9%, has been an important source of earnings for our Broker community as well as a lifeline for business and has certainly turned around what otherwise looked like a “challenging year”.
Since April Crystal Mortgages has agreed almost £200m. in business and bridging loans with almost half of that being on our “own book” exclusive lending product. Completions since April are up by 60%.
So… what began as a disaster ended on a high note.

On the same note, How has it affected your companies market directly?

The market generally underwent a massive shrinkage in the first half of 2009 which, in turn, has greatly affected Brokers who by the very nature of their business have been badly affected with Broker outlets falling by more than 40%.
However, having identified an important window, we are noticing a significant uplift in business levels, much of which comes to us from our valuable Broker network.
As we have seen, it is important to identify the area of need and then to supply that need. Brokers have seen this too and are starting to see the rewards.
We have also seen an uplift in business from direct and other sources so having suffered a major reduction in business early in 2009 we have returned to well above earlier figures.


So with 2009 in the past, What issues do you expect to occur from 2010 with regards to the financial services in general?

Tsunami is the word in all mouths right now. Green shoots of recovery appear quickly when the tidal wave recedes but are we all waiting for the Tsunami effect ?
I really do not know as none of us have seen times quite like these before.
Oh yes, I’ve seen many recessions and survived many as well but this is somehow different as, this time, it was the Banks that all collapsed and I do not think we know the full extent of the write down of sub prime mortgage bonds upon which the Banks have historically traded.
What I do know is that a few years back a mortgage bond was thought to be worth 100% of it’s face value. Now about 30% recovery is thought to be good with some going as low as 5%. Therefore, if $450 Billion were issued in the 2 yrs. to 2007 with about a third of these being sub prime the current “value” is about $100 Billion so the write off is about $350 Billion. We have not yet seen the full effect of this nor has it been declared as it is only when a Bank stops lending that the cracks really appear so this could be the Tsunami.
Hey come on…. We could get away with it and it may never happen. If lending continues it probably won’t happen so let’s look forward to 2010.
If the current trend continues Crystal Mortgages will continue to consolidate it’s strong position in the market place and we take the opportunity to assure all of our Broker and direct clients of strong ongoing support.


How do you predict your companies market to change in 2010?

My own view is that there will be very little real change.
To be fair, how can Banks take risks and lend to other than absolute prime customers with established businesses.
The Country needs it’s Banks to make healthy profits and strengthen their balance sheets. Taking risks is not going to help as they’ve already been there and we know the consequences.
Trading in mortgage backed securities looks like having gone away at least for the time being. If it returns the appetite will be low. Again, this may not be a bad thing as it has tended, amongst other things, to create an “easy money” atmosphere which has lead in the past to crazy lending.
Base rate is likely to stay at around 0.5%.
As property values continue to rise confidence should strengthen and we should all see continued uplift in business levels.


Finally, what do you think the economy will do over the course of 2010?

This is all down to the General Election and which Government gets in.
I am not going to turn this into a Party Political Broadcast so I will be bi-partisan.
Let’s forget about who got us into this mess and why. The fact is that the Country has a massive deficit on it’s balance sheet and unless the tide can be turned faces a financial down grading on the world stage from Standard and Poors (and others) affecting our trading status as U.K. Plc. This leads us down the road to ruin.
No matter what either of the Political Parties says, the only quick fix way to turn the tide is taxation at all levels so we may have to endure a hike in taxes for a short while. How long we have to put up with it will depend upon which party wins the Election. Whilst we are all biting this bullet, interest rates are likely to be held low so as to keep up the rate of spending otherwise we face deflation as well which is even worse than inflation.

And… if you’re not bored or scared to death by now, you probably never will be so…. Happy Christmas.

I would like to firstly say thankyou to Roger for giving us his time to speak upon the year past and what the future may hold!

Secondly, i would like to ask people to get involved, show their thoughts and opinions!!

Plese could you not copy and paste any aspect of this interview without permission from myself, thankyou!

2009 ends.....2010 begins

As 2009 comes to a close, 2010 is on the horizon, What do you think we are able to expect in 2010 with regards to the financial industry??

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