I am sure this will be worked through, and although a long-standing issue, it is encouraging to see the FCA facing into this challenge and consciously trying to free customers, who through no fault of their own, find themselves in a challenging position. We’ll obviously be keenly awaiting the publication of the final report and will keep you updated on the resulting rules and policy, as well as the timelines for implementation. Time to diversify? Remortgaging in 2018 was at its highest level in a decade, with many borrowers who had come to the end of deals looking to lock in low rates on a longer term basis before any more rate rises took effect. Also, those who had perhaps wanted to move but were put off by the political and financial uncertainty of Brexit, now looking to remortgage in order to fund extensions instead. Here, we have certainly seen business mirror the market trend in terms of a fall in purchase activity as opposed to remortgage/product transfer business. The mortgage market also saw a fair amount of product innovation last year and that is likely to continue into 2019. In particular, equity release and the later life lending market is set to grow further as the older population increases. ONS figures show that in 2017, around 18.2% of the UK population were aged 65 years or over, up from 15.9% in 2007; and it is projected to grow to 20.7% by 2027. These both play to diversification and the good news is that TenetLime is in a great position to support you. With equity release for example, whereas many groups have closed the doors on this specialist advice area, here we can support you to get your relevant ER1 or CeRER qualifications, offer full list of industry-leading panel providers and all business is pre-sale assessed for you and your client’s peace of mind. We also have a full referral service for a wide variety of business, including specialist partnerships for conveyancing, secured loans, commercial insurance, will writing and of course, equity release. I’m really encouraged by the success of our partnership with Twenty7Tec since its official launch at the start of January. We already have almost 600 users signed up across the Group, with more on the way. We’re delighted by Twenty7Tec’s recent announcement that it plans to integrate with 15 new lenders throughout 2019 via MortgageApply, which allows you to seamlessly submit and track mortgage applications and is currently live with three Twenty7Tec expands MortgageApply

lenders. This signals a real appetite to engage and reach a critical mass of lender integration, adding high street names such as Santander, Barclays and Natwest. We have received lots of positive feedback on the sourcing side but we see this latest development as really significant in terms of establishing Twenty7Tec as the market leader in this space. We’ll keep you updated as the lenders come board and you will soon start to see more and more ‘Apply’ buttons appearing next to lender names on your sourcing results. IDD and CPD It’s worth just noting that by the end of March, we will be over half way through the first CPD year for IDD, so you should have logged about 8 ¾ hours out of your required 15 hours. Remember, this can be structured or unstructured and that all our Tenet events now specify the IDD CPD hours within the agenda. Our 2019 events programme is now available to view on the extranet, giving you an ideal opportunity to map out your CPD requirements for the year. Insight Activity We were pleased to announce in January that we have a new relationship with an external research agency, Trinity McQueen, who are supporting us with an independent review of TenetLime and our other brands. This is to ensure that we’re offering you the best possible service today, as well as ensuring we’re fit for the future and your opinions and experience are an integral part of this. Thank you very much therefore to everyone who took part in these interviews - we really appreciate your support and will be in a position to share with you later in the year what the outcomes of this work are. Additionally, we have launched an ongoing ‘pulse survey’ to help make sure we understand how your needs are evolving and we can continue to fully support the growth of your business. We appreciate that you are probably approached by a lot of different parties for your views, but hope that you will prioritise our surveys, as they are crucial to ensure we are meeting your needs on an ongoing basis and that you’re involved in our overall plans for the future. So, a lot going on in this first quarter of 2019, both at Tenet at and in the wider industry. The next time I write, we will be in either a deal or no-deal Brexit world and starting to navigate the changes laid out by the Mortgage Market Study. However, rest assured, we’ll help you navigate the path ahead, as well as starting to shape our future plans based on the key themes from your feedback.

changes and reflect on how businesses may need to change. Of the areas in scope for the Mortgage Market Study, two in particular are likely to deliver profound change – long awaited support for ‘mortgage prisoners’ and the creation of a digital comparison tool for consumers to help find a mortgage adviser to suit their individual needs. In terms of the digital comparison tool for consumers, much like choosing a hotel on one of the various comparison websites, priorities will differ from customer to customer. Some place greatest importance on the views of other guests, whilst others use locality or facilities as the main driver for making their decision. What is unclear at this stage is both who will develop the comparison tool, and the specific criteria that it will allow consumers to search by when looking for an adviser. I am sure that a natural concern of the regulator will be to ensure that both the criteria on offer do not become overwhelming, and that they remain as objective as possible to avoid manipulation by market participants. The final risk is that without a comprehensive, compelling and sustained programme of consumer engagement, the comparison tool could quickly become a white elephant. To succeed in terms of the initial objectives, it needs to become the go-to tool for consumers. Comparisons to the change in consumer behaviour driven by TripAdvisor have been used to outline the regulator’s aim. Today few people now simply type into a search engine ‘restaurants in Leeds’, much preferring to use TripAdvisor due to the depth of comparison it offers and perceived independence of its content. Irrespective of the specifics of how the tool operates, as a large network, we are feeling positive that any ranking criteria will play to our strengths, with our whole of market product range, quality control, financial integrity and high customer advocacy, as demonstrated by ongoing TCF scores over 99% for TenetLime. The second key area considers how the regulator is looking to actively support the needs of consumers who have found themselves as so-called ‘mortgage prisoners’. As many as 200,000 people are thought to be in a situation where they cannot move from their existing mortgage product, many of which have reverted to SVR. This may be due to the mortgage product being taken out before more stringent affordability requirements were introduced, or simply because their original lender failed during the financial crisis and the mortgage book was transferred to a third party administrator. Press coverage and comment has been significant in recent months and I expect this to be a key strand within the study’s final findings and interventions. What remains unclear at this stage is where liability for any subsequent default or mis- selling complaint might lie, if the regulator makes such an active intervention.


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