Home Finance Barclays strikes $2.8 bln deal to buy mortgage lender Kensington

Barclays strikes $2.8 bln deal to buy mortgage lender Kensington

by Enochadmin

A lady walks previous a department of Barclays Financial institution, in London, Britain, February 23, 2022. REUTERS/Peter Nicholls

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LONDON, June 24 (Reuters) – Barclays (BARC.L) has struck a deal value round 2.3 billion kilos ($2.8 billion) to purchase specialist lender Kensington Mortgage Firm, extending its attain in Britain’s housing market.

The acquisition represents one in all Barclays’ greatest latest transactions and a sizeable guess on the property market.

British home costs have continued to rise prior to now few months regardless of rampant inflation pressuring households, though business consultants predict them to chill later this 12 months. learn extra

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Kensington is being bought by its non-public fairness house owners Blackstone (BX.N) and Sixth Road.

Barclays mentioned on Friday the ultimate value would rely on the dimensions of Kensington’s mortgage portfolio on the time the deal completes, with Barclays estimating it might comprise round 2 billion kilos value of residence loans.

Barclays shares edged up in early buying and selling earlier than dipping 0.5%, broadly according to the European banking shares index. (.SX7P)

Barclays has been comparatively acquisition-shy not too long ago, though the financial institution purchased a $3.8 billion bank card portfolio co-branded with clothes retailer The Hole (GPS.N) final 12 months. learn extra

The lender expects to finish the Kensington deal later this 12 months or early subsequent.

Kensington, which has 600 workers, specialises in offering mortgages to folks with complicated incomes, such because the self-employed.

Barclays mentioned the deal can be funded from present sources and would scale back its core capital ratio by round 12 foundation factors.

“The transaction reinforces our dedication to the UK residential mortgage market and presents an thrilling alternative to broaden our product vary and capabilities,” mentioned Matt Hammerstein, CEO of Barclays Financial institution UK.

($1 = 0.8149 kilos)

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Reporting by Iain Withers; enhancing by Jason Neely and Jane Merriman

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