FNTC reported in the past that it had joined forces with Shawbrook Bank PLC so as to make financing easier for many Britons buying a timeshare. The said Shawbrook supported the timeshare industry with the offer of holiday finance which resort developers would receive via supplier-creditor-debtor agreements.
The Shawbrook offer, therefore, made it easier for people to buy a timeshare and the collaboration gave developers the chance to choose the right legal structure for holiday ownership developments which is an essential element if they wanted to offer customers a finance facility.
Shawbrook claimed to offer unsecured loans from £1,000 to £50,000 (subject to status) and to British residents looking to finance their holiday ownership.
And now they are up dickies meadow, in the mire and admitting they did not risk assess the lending to the timeshare consumers and others, therefore they are canoeing in a stream of tears at present.
As the news broke yesterday, that Shawbrook has admitted to handing out millions of pounds on loans that have not been adequately assessed for risk. The share price has plummeted as toxic debt is expected to mount.
Shawbrook is a big bank supporting timeshare and the Timeshare industry, provide it with needy finance for consumers and at many large timeshare Resorts.
As it has now been revealed that due to an upgrade in their risk management systems, they have become aware that there have been breaches in their lending systems, which has resulted in many loans being given when the lending risk was far too high.
Shawbrook said that the ‘irregularities’ took place in its asset finance division where certain loans ‘did not meet the business’s strict lending criteria’.
Uncertainty is now the word at Shawbrook, who announced that their Finance Director Tom Wood has resigned.
Mr Wood was reported as stating that his departure is not related to the latest revelation about their dodgy loan lending, which simply adds more speculation to the situation.
The shares in Shawbrook have been steadily dropping after the FTSE-250 lender was forced to set aside £9 million to cover for eventualities, resulting from £14.7 million worth of risky loans.
This also means that other timeshare finance lenders may also have their policies reviewed as Shawbrook may not be the only one to be exposed in the future.
Posted on: 6th July 2016