Barclays to acquire Kensington Mortgages for £2.3bn

Barclays has confirmed that it will acquire specialist lender Kensington Mortgage Company in a £2.3 billion deal.

Kensington, which has 600 staff and specialises in offering mortgages to the self-employed and borrowers with more complex incomes, is being sold by private equity owners Blackstone and Sixth Street. The company originated around £1.9bn of mortgages in the year to 31st March 2022.

The bank will also take ownership of a portfolio of mortgages offered by Kensington Mortgage Company, worth £1.2 billion, in efforts to lend to a greater variety of customers. The deal comes after the pandemic led to an increase in the number of self-employed borrowers and those with complex incomes due to the impact of the Government’s furlough scheme and the wider effect on job volatility.

The acquisition will mean that Barclays is one of the few major high street banks to offer more specialist lending solutions.

The deal is subject to regulatory approval and is expected to complete later this year.

Kensington Mortgages Chief Executive Mark Arnold said “We have a strong track-record in the specialist mortgage space, using our proprietary data and tech platform to innovate and grow, and now is a natural point to bring in a partner who can help drive our next expansion phase.”

Barclays Bank UK Chief Executive Matt Hammerstein said “Kensington Mortgage Company is a best-in-class specialist mortgage lender with an established track record in the UK market, strong broker and customer relationships and data analytics capabilities.”

“It complements our existing UK mortgage business and broker relationships through the addition of a specialist prime mortgage originator and the utilisation of our strong UK funding base.”