Templeton negative on mortgage banks

property

Martin Cobb and Ken Cox, managers of the Templeton UK Equity fund, are negative on mortgage banks, y...

Martin Cobb and Ken Cox, managers of the Templeton UK Equity fund, are negative on mortgage banks, yet still look favourably at UK house builders. Cobb, co-manager of the £40m A-rated fund, said: "Typically, what is bad for one of these sectors should be bad for the other, so this is an interesting theme. "Although they look cheap, we believe the mortgage banks are vulnerable to falling fee income. These generate a lot of business, for example, on mortgage arrangement fees, household contents insurance and mortgage protection insurance, at the point the mortgage originated. That income w...