"By bringing the two organisations together, we can use our combined capabilities and scale to offer an even stronger proposition to UK homeowners."
Shawbrook has announced the acquisition of specialist lender Bluestone Mortgages in a cash and share deal.
Launched in 2014, Bluestone supports customers which don’t fit the traditional profile of high street banks.
Bluestone has originated over £1.8bn since its launch, and currently manages a book of over £1.3bn residential loans.
Shawbrook has been working with Bluestone since 2017 through a platform lending arrangement.
The latest announcement follows Shawbrook's acquisition of The Mortgage Lender in 2021.
Marcelino Castrillo, Shawbrook's CEO, commented: "We are delighted to have strengthened our long-standing and successful partnership with Bluestone Mortgages through this acquisition. Bluestone Mortgages is a well-established brand in the UK specialist residential mortgage market, and by bringing the two organisations together, we can use our combined capabilities and scale to offer an even stronger proposition to UK homeowners.
"Driven by increasing numbers of people choosing to work for themselves or in sectors where incomes are complex, we anticipate significant long-term growth in the specialist mortgage market. With both Bluestone Mortgages and The Mortgage Lender brands combined with Shawbrook’s strong and stable balance sheet, the Group is very well placed to consistently meet this growing demand.”
Steve Seal, Bluestone Mortgages’ CEO, added: “This transaction is great news for Bluestone Mortgages, our intermediary partners and our customers. Shawbrook has been a long standing strategic partner for many years and joining the Shawbrook Group is a natural step as we continue to grow and develop the business.
"We have exciting growth plans and the support available from Shawbrook will help to accelerate these, enabling BML to provide innovative lending solutions to the growing number of customers who will need the support of a specialist mortgage lender.”
Lewis Shaw, owner and mortgage broker at Riverside Mortgages, said: "First, Barclays bought Kensington, and now Shawbrook is buying Bluestone. It looks as though consolidation in the specialist space may be the shape of things to come, reducing trading costs and increasing profitability in the face of what appears to be significant economic headwinds. Hopefully, it means those borrowers who have more complex circumstances can continue to be served, as it's likely that demographic is about to grow by quite a margin."
Justin Moy, managing director at EHF Mortgages, added: "Shawbrook has been the main funding partner for Bluestone for a number of years, so this is a very good acquisition for both sides. It looks like the Bluestone brand will stay for the time being, and Shawbrook will leverage some of the IT systems and processes that Shawbrook desperately needs for its own business. Specialist mortgage lending is a very profitable business area that will be a growth opportunity for many years to come. Increasing demand for flexible underwriting to help support business owners, complex incomes and credit-impaired borrowers will be welcomed by the market."
