Alliance & Leicester this week outlined its plans to raise its property lending by £1bn.
Charles White, director of strategy development & property lending at A&L, said the bank planned to increase its commercial property loan book from £500m to £1.5bn by the end of 2008.
He added that it had built up an experienced property lending team of nine, with hopes to have at least 14 by 2007. Alan Smith heads the property finance team and John Graham looks after development funding.
“Our property team is top heavy in terms of age and experience — the average age is 42 and property finance experience 17 years. We have been very careful with our recruitment and have selected experienced people with great contacts, from a wide range of institutions like Dunbar, Allied Irish Bank and Barclays,” White said.
He said the bank was also considering managing funds raised from its retail base.
White admitted that property finance was a very competitive field, but questioned the aggressive terms being offered by some of the bank’s smaller rivals.
“Our offering is more about flexibility and service. It’s fair to say we are more risk-averse in outlook. But we are facing increasingly aggressive competition from smaller, less well-known building societies. It must be a concern as to how they can make the returns work,” he said.
A&L, while better known for retail banking, has been steadily building its reputation in aviation, shipping finance and private finance initiatives.
“We intend to be around for a long time,” said White. “But because we have come to the market late we have a clean book, which gives us a contra-cyclical advantage in a downturn. When others will be looking to preserve their books, we will still be growing.”
