'Brexit' Debate Delays Secure Trust's Plan to Offer Mortgagesby
Small U.K. bank curbs lending to London real estate developers
Lender puts off plan to offer U.K. mortgages until second half
Secure Trust Bank Plc, a small British lender, said it delayed a plan to start offering mortgages and curbed lending to London real estate developers over uncertainties arising from the U.K.’s June vote on European Union membership.
“There’s no point in us for the sake of three months busting our guts launching a new proposition when we can have the luxury of just taking a more prudent and cautious stance,” Chief Executive Officer Paul Lynam said in a telephone interview Thursday. “It could be a non-event, it could be catastrophic. You’ve got no idea of what’s happening.”
Some senior financiers have predicted a U.K. vote to leave the 28 member trading bloc in a June 23 referendum would damage the British economy, threaten London’s status as a global business hub and drive firms from banks to asset managers to relocate jobs.
Secure Trust Bank is preparing to offer mortgages for the first time after reporting a 18 percent increase in pretax profit to 39.3 million pounds ($56.2 million) for 2015. The bank said it will postpone the sale of home loans in the U.K. until the second half of the year and may revisit its decision to reduce lending to property developers in Central London after the vote.
“We have tempered our residential development lending appetite,” Lynam said in a statement. “We have no way of knowing the outcome of the referendum, so it is prudent to proceed with caution whilst clarity on this very important issue emerges.”