Article as featured in Bridging Introducer – October 2014

Earlier this month, as has already been widely publicised, the dedicated ‘large loans brand’; ‘Quantum by Bridgebank Capital’ was launched by the Bridgebank Capital Group, in respect of the Group’s lending activity for bridging loans over £1 million, development finance and structured property finance.

The Bridgebank Capital Senior Management Team took the strategic decision to launch the new “Quantum” brand, having listened carefully to feedback from their valued broker introducers as well as that of their Business Development staff. As a direct result of this ‘field’ feedback, further extensive research was undertaken which resulted in internal organisational strategic changes and the creation of the Quantum brand.

The Bridgebank Capital Management Team took the view that there is a clear and distinct difference between what has been classed as ‘traditional’ bridging and the more corporate lending approach required for large loans. This differentiation, alongside the lender’s desire to enter into the development finance sector, highlighted the requirement for a clear distinction to be made by Bridgebank Capital in respect of the dynamics to support these vastly different property finance products.

The launch of Quantum by Bridgebank Capital creates this differentiation, demonstrating the lenders commitment to service support and expertise in order to deliver large loans, development and structured property finance aligned with market requirements. This approach also delivers to introducers and their clients, the total ‘one stop shop’ lending solution, within the Bridgebank Group, for all short term property finance requirements.

The team

Quantum by Bridgebank Capital is headed up by Carl Graham, National Corporate Account Manager and Steve Bryce, Head of Credit Risk, and is staffed by a highly experienced professional corporate lending team who have a mandate to ‘personally look after’ introducers and brokers, adopting an approach to their working relationships, in the form of a “partnership”  fashioned on the service level and access commitment of how ‘hands on, relationship driven’ bank managers used to operate. All potential borrowers meet a member of the Quantum team as soon as is viably possible in the application process, ensuring a full understanding is gained of the client’s requirements and circumstances.

All application documents are primarily discussed and agreed at these initial face to face meetings, ensuring that the highest level of service is delivered. At this very early stage in the process, it is clearly communicated what is required of the applicant, and what can be expected from Quantum by Bridgebank Capital.

A dedicated Underwriting and Processing team has been established to process the finance proposals received by Quantum by Bridgebank Capital. It is recognised that an independent team, with tailored processes and specialist knowledge is required to successfully progress these applications and deliver the level of service required.

Whilst the Bridgebank Capital Group has undergone significant growth during the last year, it is envisaged that as the Quantum brand develops, further organisational growth will be required to support the existing team.

Expectations

When processing large loans and residential development proposals, the Quantum by Bridgebank Capital team demand a much greater degree of involvement and information from introducers and brokers.

Details of funding proposals and supporting information are expected to be submitted upon application, demonstrating that a full and detailed evaluation has been undertaken by the introducer to ensure that the application is truly viable prior to submitting the proposal.

The Power of First Impressions

At Quantum by Bridgebank Capital, it is considered that first impressions demonstrate a great deal about the applicant. Upon receiving the enquiry from the introducer at the outset, most, if not all information required for funding the proposal is expected to be readily available. The absence of such information would tend to suggest that the applicant is potentially not of the right calibre to be getting involved in or investing in such large bridging finance or property development finance proposal, and in this instance, it is likely that the Quantum team would be unimpressed with the inability to be presented with a professionally prepared full and comprehensive information pack, and are likely not to proceed further with the case.

The Quantum team and overall, the Bridgebank Capital Group is committed to delivering the best, and therefore dealing with the best! – And yes, in this scenario, first impressions really do need to be the best!

FOUR Q’s :  Quality introducers have Quality clients with Quality deals, which is what Quantum are looking for! The 4Qs are linked together and delivers the calibre of applicant and application that ought to be successfully funded for this more corporate sized transaction .

Based on the quality of the initial early reaction the Quantum brand launch has had to date, it is evident that there is certainly no lack of funding opportunities. Within one week of the official launch, Quantum by Bridgebank Capital received enquiries totalling a value in excess of £300 million. Positive feedback has been received which demonstrates how welcome the new brand and product portfolio is within the short term property finance sector, the clear distinction this sector deserves from that of the Bridgebank traditional bridging lending, and in particularly the opportunities that still exist within the Greater London market.

What’s next for Quantum?

Quantum by Bridgebank Capital will now focus on extending its introducer network, with a greater emphasis on expanding its relationships with professional advisors, and subsequently growing its loan book and market share.

At present, the Quantum brand is clearly in its first growth phase, and whilst these first weeks have been extremely encouraging, it is recognised that there is still work to be done. As the team works closely with introducers and their borrowers, they will be afforded the opportunity to identify where existing processes and lending structures can be enhanced further to ensure the products provided are fully aligned to borrower requirements.

Due to the nature, geographical location and value of the lending enquiries received by Quantum, it is envisaged that the brand will most actively be transacting business in the South and Greater London market. Based upon this finding, the lender is establishing a greater team presence to be based out of central London than currently exists. This presence, and the representation of the brand, will ensure that face to face meetings with all relevant counterparties can be organised without delay, where the dedicated professional decision makers will be on hand to meet introducers, their clients and the applicants supporting professional advisory team, to discuss their client’s corporate lending requirements.

Development and structured property finance are new lending areas for the Bridgebank Capital Group, and whilst the skills and expertise required for delivering the products are available in-house, there is always more that can be achieved. The lender does however clearly demonstrate that they have both the appetite and confidence to enhance their product offering, and will continue to identify appropriate and valuable gaps in the market through industry research and feedback from introducers.

What does this change mean for Bridgebank Capital?

Bridgebank Capital and Quantum by Bridgebank Capital are two distinct yet joined brands, which together provides the most comprehensive offering to the short term property finance sector.

Bridgebank Capital continues to operate as a whole of market lender in the traditional bridging space that it is well known for, with a dedicated highly experienced team. With a wealth of experience in this market, Bridgebank Capital are able and committed to providing the highest level of service to introducers and their borrowers, utilising their product and industry knowledge and experience.

The Bridgebank Capital Group Board see the two ‘Bridgebank’ brands working together in tandem, and expect that this new ‘split’ structure will deliver the exponential growth that the Bridgebank Capital Group aspires to achieve.

What else is happening?

Regulation

Regulation holds no fear for the Bridgebank Capital Group. As a long standing, regulated lender, that has established its business in a totally compliant manner, with ‘Best in Industry’ back office administration and processes, any further regulatory impositions on the industry will not hold any concern for the company.

Competition

Yes, competition is quite fierce! A plethora of junior entrants came into the space in the last couple of years, and yes, there is a need for lenders to be working smarter to attain a fair share of quality business. The key word in the last sentence, however, is “quality”, as there is evidence that over the last two years or so, a large volume of what can only be regarded as very high risk, low grade quality bridging loans have been written by a number of lenders; particularly those new lenders in the sector. There is also clear evidence that the inexperience and poor underwriting from these lenders is now coming back to haunt them.

Bridgebank Capital’s philosophy has always been that growth for growth’s sake by taking risks, delivers ‘short term gain with permanent pain’, and it certainly doesn’t work!

The Bridgebank Capital Group continues to grow its loan book in a sensible manner. Even during its growth, the lender can proudly state that it has not had one loan default requiring legal recovery on any new lending since 2008.

As a lender, even for unregulated loans, there is an inherent requirement from the regulatory authorities to be mindful at all times of the precept of ‘Treating Customers Fairly’. Many bridging lenders are still advancing loans where it is clear that the loan is likely to impose high financial risk to the borrower, and as such, is irresponsible lending that cannot be regarded as being compliant with ‘Treating Customers Fairly’.

The Bridgebank Capital Group can clearly demonstrate that in the main, they lend responsibly to borrowers that have a high degree of certainty to repay their obligations. This is clearly evidenced by the fact that notwithstanding that the loan book is growing every month, the Group can still operate with a very small Credit Control team.

Responsible lending across all of the products and brands in the Group is a prerequisite of the Bridgebank Capital modus operandi.

Summary

With the market enhancement created by the Quantum brand, the Bridgebank Capital Group views the future with confidence. As a whole of market lender, operating in the short term property finance space, providing large ticket bridging loans and development finance, alongside traditional bridging loans; introducers and borrowers alike have the confidence that they are dealing with a lender with an appetite to lend, and just as importantly, probably one of the most highly experienced professional support lending teams and service platforms in the sector.

Bridgebank Capital have all the tools, and look forward to further expansion of their loan book.