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CV: Ian Giles is responsible for Kensington's marketing and communications. He has more than 20 years experience in financial services, working for market research agencies and lenders including Mortgage Trust, First Active and technology providers such as Misys. He joined Kensington in 2005 from online and telephone mortgage broker Purely Mortgages, which he helped set up in 2004.

MA: H ow did you move into your current role?

IG: I was recruited by Alison Hutchinson, who is the former chief executive of Kensington Group. She interviewed me in the summer of 2005 and offered me a job with Kensington. I was working at the time for a broker called Purely Mortgages, which I had set up with a couple of other guys and it had gone quite well. Purely Mortgages still exists, but I got asked to join Kensington and saw an opportunity thrust my way. At Purely Mortgages I was the marketing director but I was also a qualified mortgage broker, mainly because I wanted to make sure I understood the business really well as well as the marketing side of things. It was great because it was a start up but also I now truly understand an intermediary's business, what a mortgage broker is looking for and how the business works in terms of cash flow, the importance of repeat business for existing clients and things like that.

MA: What were you tasked with doing when you first moved into the role?

IG: The first job was to make sure the diversification Kensington was going through was fully understood by the market. Clearly the fact Kensington had originally pioneered the adverse credit market in 1995 was a great feather in the company's cap but there was more to be done and diversification since then has happened. We were actually planning that and moving towards that throughout 2006 and into 2007, so certainly when things happened last summer in the way they did it was nice Kensington had already diversified. We had actually built a sounder and broader base for our business.

MA: How was the first half of 2008 for Kensington?

IG: It has been tricky, really difficult, in common with everybody else in the market. It has been the most challenging few months of the UK mortgage industry since I do not know when. I first worked in the industry in 1991 so I have seen the early 1990s and therefore I can compare now with then. The early 1990s was a completely different set of dynamics, it was similarly scary for people involved in the industry but I suggest this will probably not be quite such a big crash in terms of house price deflation.

MA: Kensington was bought by Investec last year. Do you still have its backing despite the current downturn in the market and do you expect to have it for sometime to come?

IG: The proof of Investec's support is in the fact we have restructured. The recent announcements of restructuring would not have been made without Investec's backing. If you think about it if they had not backed us there would not have been any point in protecting the senior management, top talent and having a three-year plan that will get us through this particular credit crunch and into new opportunities. The alternative would not have been as rosy, but clearly by saying yes we back your plan, yes we back the idea you need to restructure to make sure your cost base is right, then I take that as proof Kensington has got the full backing of Investec. Clearly in the current environment backing a three-year plan is about as certain a backing as you can get really.

MA: Do you ever anticipate a return to sub-prime and your past product range?

IG: The products we will come back with will be different from those before. It will depend on investment appetite. We are well versed at constructing products for people that have had the full range of credit issues in their past, anything from having a couple of very minor county court judgements to having bankruptcy, individual voluntary arrangements and being in arrears. Just because we are experienced at producing those products does not mean we will get funding for them. I expect funding at the beginning will come into near prime and it is that sort of product that is likely to return to the market first.

MA: Kensington has branched out into investments with parent company Investec. How is that working out?

IG: It is early days but so far so good. The way they are issued is in an eight-week cycle. You issue the actual offer of the product range, the mortgage and investment advisers go out and find customers who are right for those products. Customers then decide whether to buy or not, then there is a cut off at the end of that eight week period by which time you expect to get the right amount of funding you need to make the thing work. When that stops another one starts. Apparently you need to be in the market for at least two or three of these cycles before people understand what your offer is, how consistent it is and are reassured you are here to stay. Clearly we have to just build that credibility and establish that trust in the minds of all of our distributors, so I think we will probably gauge success later on in the year.

MA: Kensington brought in a tranche-based system. What was the reception among advisers and are you surprised others did not follow you?

IG: The reception we had from advisers to start with was: "Fine but tell me how this works and why do we have to have any constraints? Why can I not do business whenever I feel like it with you?" We did have to educate a few people in terms of what we are trying to do is manage their expectations. We had already introduced a booking procedure, which again intermediaries asked why that was necessary. If you have got real relationships with big intermediaries, networks or clubs you can sit down with them and say we are doing this for your good as well as ours and get heard out. We are telling people when tranches are 50 per cent full or 75 per cent full, so they can actually run their businesses and advise their customers with the same degree of visibility as we are running ours. It is a very disjointed relationship between lender and intermediary and what we are trying to do is smooth that relationship to make sure over the course of the month intermediaries know how to deal with Kensington and when to deal with us. I do not understand why other people have not done the same. Maybe they do not have the technology, maybe they do not have the service focus or maybe they do not feel they have to do it because they feel they are big enough not to have to bother, which is dangerous.

MA: What is the biggest challenge Kensington is facing at the moment?

IG: Lack of liquidity. There just is not anything else that comes close to it on the scale really. Lack of liquidity and also trying to manage a business while keeping relationships open and making sure you are around in another couple of years in order to take advantage of the upturn. Now some other people with a lack of liquidity are probably just saying well we will just close down but our challenge is we are actually going to stay around. Anyone who was around in the early 1990s knows once we hit the bottom, which may well be in the next few months, and start climbing again the opportunities that will come up for intermediaries, for lenders and for other third parties involved in the industry will be massive. If they look back to the mid 1990s there was a huge number of companies who actually spotted opportunities, made the most of them and spotted them before other people did, and as a result built business very quickly and businesses that are still around today. Kensington is a case in point. We built our business in 1995, just after the last big downturn in the mortgage industry, and I do believe Kensington will rebuild its business probably in slightly different ways as a result of coming out the back of this downturn as well.

MA: What would you predict for the future of the mortgage industry?

IG: We have already put our cards on the table a little bit with the announcement of the restructure. We are looking at 2009 at the earliest for market recovery. We do not believe securitisation will come back soon. We do not want to put a date on it but clearly the way we are shaping our company is looking to 2009, 2010 and 2011. Those are the years we feel we will see recovery. We do feel that there is probably more to go in terms of house price deflation. I do not think we are through that yet and we need to get through that before consumer confidence will return and the market starts feeling better about itself and possibly funding returns too.

MA: What is the biggest challenge you have ever faced?

IG: Professionally I would say this one. In the early 1990s I was quite junior. I did a job where I was not perhaps privy to quite as much information and also not in charge of as many people. When you are younger in an industry like this, when there is great structural change, you pick the opportunities that come up but you are free to leave as well. So there is not that feeling you are responsible for the function or a team of people or your company's brand because you are not being asked to take that responsibility. This time around I would say the liquidity crisis is a nasty shock to the system, but hopefully we will see a market recovery next year. It is not any worse than the early 1990s. It is different in lots of other ways but I do feel since I am director of marketing and communications at Kensington now I feel more of a responsibility to people in the industry.

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