by Mark Johnston
Dyfrig John the former chief executive of HSBC bank has spoke out in regards to the sympathy he feels for first time buyers wanting to enter the market in the current climate.
Dyfrig worked for HSBC for almost 40 years before moving back to his native Wales to become chairman of the Principality building society has raised concerns over the plight of first time buyers who are struggling to get onto the housing ladder because of the high deposits banks and building societies are requesting.
He said: “If you get more volatility in the value of property I think that advocates that we have to continue to be quite cautious in this area. But it is sad that people are having to save up for so long and then as they’re just about getting there this happens, so I have some sympathy with them.”
Mr John pointed out that the industry should concentrate on whether borrowers can afford their home loan instead of how much of a deposit they have.
He was also concerned that borrowers were not taking future interest rates into account and that they needed to make sure that they could not only afford a mortgage now but in future as well.
He commented by saying: “At the moment of course, with interest rates being very low, people could be lulled into a sense of ‘Well, I can definitely afford it’, and interest rates could well increase over the next year or so – I think will increase over the next year or so – so I think therefore we just have to be cautious over that as well.”
Mr John was involved in emergency talks at the hight of the financial crisis. He was heavily involved with discussion with the government and attended meetings at Downing street with ministers that often ran through into the night.
As former head of HSBC bank Dyfrig John was called upon for his weath of knowledge and experience, he said: “We were meeting more and more often and it tended to be with the chancellor, the governor of the Bank of England would be there and the chairman of the FSA would be there, and five or six chief executives from major banks,”
He went on to say: “This was a major crisis, this was very frightening, and not all the public would realise the great seriousness with which things were happening. It wasn’t a period I would like to repeat.”
In a recent interview with the BBC, Mr John predicted that the economy would probably stagnate and see little movement over the short term. He talked about the impact of his home country Wales but the same could be applied to the whole of the United Kingdom.
Dyfrig said: “The key is taking businesses from two, three employees to 20, to 50, to 100,” he said. “That is the art of what we have to do in Wales. It is incredibly important for Wales to have a vibrant SME sector.”
Related stories to : Former HSBC Speaks Out on The Plight of First Time Buyers