Hampden & Co, the Edinburgh-headquartered private bank, is entering the intermediary mortgage market after inking a partnering deal.
The bank, which opened in 2015 to service high net worth clients, said it had agreed a tie-up with Paradigm Mortgage Services. Hampden noted that the mortgage arrangements of its clients can “frequently be complex”.
Chief executive Graeme Hartop said: “Working collaboratively as part of a client’s advisory team is core to what we offer at Hampden & Co.
“Approximately 75 per cent of residential mortgage business is via the intermediary market with many of these clients being high net worth individuals who don’t necessarily fit with high street bank’s lending formulas.
“We therefore feel there is huge potential to help clients looking for a bank who can take their individual circumstances into account. Entering this market with a carefully selected partner is a logical step for us.”
He added: “Under Paradigm’s umbrella are a large number of directly authorised intermediary firms, many of whom specialise in supporting the unique needs of high net worth clients, so it was a natural fit.”
Hartop also noted that the closure of bank branches and the switch to internet banking and automated advice had led to “a very de-personalised banking experience”, adding: “Many successful people still value a personal, professional service. That’s what we do, and it’s working.”
John Coffield, head of Paradigm Mortgage Services, said: “As in the main market, there is an increasing complexity to many borrowers’ income sources – especially the case for wealthy individuals – and it’s important they work with lenders and banks that understand the need for a bespoke lending service.”
Hampden, which also has offices in London, recently reported results which revealed that income increased to £3.9 million during the year – a rise of 138 per cent – although that was offset by costs rising 30 per cent to £10.3m.
Loans to clients grew by 96 per cent to £94.2m and deposits by 35 per cent to £194.6m. Operating losses edged up 1.6 per cent to £6.4m.
Hartop, who is a former managing director at Scottish Widows Bank, said that the losses were “entirely in accordance with our business plan”, and were to be expected by a new bank.
“The fact that our recent capital raising was over-subscribed demonstrates the justified confidence that our shareholders have in the long term prospects for the bank, ” he said.
The bank was set up by its chairman Ray Entwistle, a high-profile financial services player and former chief executive of Adam & Company.