Black & White exit ‘tip of the iceberg’

Black & White confirmed it had voluntarily rescinded its Part IV permissions, which allowed it to operate in the regulated market, and concern has grown that more firms are set to follow suit.

Black & White refuted suggestions the move was related to the Financial Services Authority’s investigation following the regulator’s surprise visit in November 2007.

The firm said it would continue to trade in lead generation, secured loans, commercial loans, and its mortgage packaging arm, B&W Gateway.

Thomas Reeh, Black & White’s chief executive, has also stepped down with immediate affect, though he stressed the move was a mutual decision and ‘completely amicable’.

The group said that further job losses would be forthcoming to add to those previously announced.

Reeh said: “We felt as a board that our efforts were best placed in other areas, but Black & White will come back into the regulated market the minute the market looks like it will turn around. That’s a given.”

Mark Chilton, chief executive of Homeowners Mortgages, commented: “Black & White’s model was very closely aligned to just non-conforming. The problem is that while there is some capacity at the lighter end, those built round the more severe end just can’t write the business. It’s very tough for brokers in that sector. The worry for mainstream brokers is the downturn in volume.”

Richard Morea, technical manager for London & Country, said: “The non-conforming sector has been heavily hit in the availability of funds and attractiveness of products to consumers.

"The business just isn’t there and it will be tough. We will see more casualties, though they are unlikely to be so high-profile and will probably be smaller firms which are under the radar.”