Lombard Vehicle Management has stopped transacting new business
through brokers and intermediaries, the RBS-owned fleet management
and leasing company announced.
“Today we have announced that we are exiting from the introducer
market in the UK for both our Lombard Business Finance and Lombard
Vehicle Management businesses,” the bank-owned lessor said in a
statement.
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“[Dealing directly with customers] will mean our relationship
managers in these units will spend more time directly with
customers understanding and supporting their requirements and
offers businesses the opportunity to deal directly with ourselves
rather than through a third party.”
Lombard said that ever-closer ties with the bank’s business,
commercial and corporate channels would help it source new business
for its fleet and asset finance businesses.
“This change to our operating structure will also help us credit
manage our book more effectively by dealing directly with the
customer from the outset of a proposition,” it added.
Up to 85 staff across both departments may lose their jobs as a
result of the decision, although the lessor stressed that it
intends to “ensure that the number of compulsory redundancies is
kept to an absolute minimum”, promising staff its “full
support”.
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By GlobalDataA Lombard spokesman promised that all existing agreements would
be honoured, and emphasised that Lombard is still fully committed
to the fleet and asset finance markets, with the distribution model
the only aspect of its business that is changing. He added that the
lessor is working closely with banking colleagues to grow its new
business in the SME market.
The decision will hit brokers hard – but is not entirely
unexpected, said chief executive of the NACFB, Adam Tyler, who
commented: “The withdrawal of Lombard from both the asset finance
and vehicle finance broker market doesn’t really come as any great
surprise given that the strategy of Lombard’s parent, RBS, has been
to retreat and concentrate on its own customer base.
“However, there is no doubt that this is a blow for many and
particular some vehicle brokers, and could be the final straw in
some cases.
“Lombard had largely withdrawn from the asset finance introducer
market earlier this year when it controversially ‘culled’ a number
of introducers from its panel. Because of this, the impact of its
total withdrawal will have been lessened as many brokers had their
lines cut some months ago and had sourced other funding lines,”
Tyler said.
Lombard Vehicle Management won the association’s “Vehicle
finance provider of the year” award at its 2008 gala dinner, the
third win in four years for the lessor. Tyler added: “It’s a sad
indication of the state of the market that one of the biggest
lessors for brokers has had to close its doors [to
introducers].”
