Hosted by 9fin’s ABF editor, Owen Sanderson, 9fin’s latest webinar gathered an expert panel from OSB, Starling Bank, LendInvest, Barclays, and Clifford Chance to discuss the evolving UK mortgage landscape.

Keep reading for a brief summary — or head here to watch the full recording.

1. The big banks are moving into specialist territory — and specialist lenders are adapting

The hunt for yield is driving high street banks into traditionally specialist domains. As Damian Thompson from Starling noted, major lenders are entering limited company buy-to-let lending for the first time and flexing their criteria to overlap with specialist owner-occupied lending.

Hugo Davies from LendInvest framed this as "specialist lending 2.0" — incumbent specialists are being pushed into more esoteric areas like semi-commercial properties, retrofit mortgages, and HMOs. Defensive advantage comes from their agility and the ability to handle complex ownership structures that don't fit neatly into automated underwriting systems.

For market participants, this means traditional categorisations are breaking down. Success will depend on finding niches where operational complexity creates barriers to entry for larger, less nimble competitors.

2. Regulatory headwinds create both risk and opportunity

While the Renters' Rights Bill impact appears "mostly priced in" according to Thompson, the Minimum Energy Efficiency Standards (MEES) legislation looms as the bigger unknown. The potential requirement for landlords to upgrade properties to meet EPC standards could require tens of thousands of pounds per property — creating complex financing needs that automated underwriting can't easily handle.

This complexity plays to specialist lenders' strengths. As Thompson explained, a landlord with 15 performing properties needing energy upgrades presents "a very complex story that is hard to do in an underwrite process which is potentially fully automated."

For specialist lenders, there is a definite advantage in being able to structure bespoke solutions to landlords navigating the shifting sands of UK regulation, with Basel 3.1 coming down the tracks and set to rebalance the economics of mortgage lending for banks.

Want to learn more about the evolving dynamics between specialist lenders and high street banks in UK mortgage markets? Head here to read more in Excess Spread, Owen's must-read weekly newsletter on ABF.*

3. Securitisation is fashionable again — but for different reasons

As Arun Sharma from Barclays observed, securitisation hasn't been this useful as a risk transfer tool for banks in 20 years. More and more institutions large and small are using mortgage securitisation for deconsolidation trades, freeing up regulatory capital and provision. These deals are sold into an increasingly large investor base willing to provide junior capital against mortgage portfolios, with private credit firms pushing into the space.

For non-banks, deconsolidations can also have benefits, crystallising P&L and releasing provisions, and these deals are only expected to accelerate. The broader securitisation market is in rude health, with strong appetite for new issues, but fear of headline risk and volatility is encouraging issuers to be more nimble about picking execution windows.

Interested in learning more about Asset Backed Private Credit? Check out this guide, which breaks down everything you need to decipher what economic activity is actually going on.

A market finding new equilibrium

The webinar painted a picture of a market in transition, where new opportunities are emerging for those agile enough to seize them. There's room for growth — but success will require navigating an increasingly complex competitive and regulatory landscape.

Check out the replay to watch the webinar in full.

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